Depreciation of renovations made easy
By | 31st Mar 16

Depreciation of renovations made easy

Many property investors miss out on thousands of dollars because they don’t know about depreciations for renovations. If you’ve bought a property investment to renovate keep in mind that you may be entitled to claim for renovations. Get your head around “scrapping” before you commence your process. This refers to any depreciable asset from your investment property such as carpet, hot water systems or timber floors. Once you understand what you need to upgrade follow the steps below as you may be entitled to claim the remaining depreciable value of items being removed or upgraded as a tax deduction.

It’s important you use a qualified quantity surveyor and accountant to prepare your tax depreciation schedule.

Step 1: Get a “before” renovation tax depreciation schedule

Organising a tax depreciation schedule before your renovations are complete are sure to save you money and time when it comes to making a claim. A valuation of all items in a property as well we photograph are required if the ATO audit your property.

Step 1: Get an “after” renovation tax depreciation schedule

After completing your renovation, a second schedule will need to be prepared to identify the value of all new capital expenditure within the property. The new schedule will outline all the depreciation claims available for the 40 years or what is considered the life of the property.

Step 3: Choose a credible provider

It is important your tax depreciation provider is ATO compliant as the process is comprehensive. Your schedule should be customised to your property ensuring that you can maximise your claims. Using a specialist quantity surveyor and accountant will streamline the process and ensure you don’t miss out on any claims.