Q1.What is Tax Depreciation?
2. In the case of body corporate, a portion of common areas and common equipment
3. Plant and Articles (light fittings, floor coverings, kitchen appliances, etc)
Q2.How does Tax Depreciation benefit the Tax Payer?
Property investors can maximise their tax benefits by claiming substantial tax deductions each year, resulting in enhanced cash flow. The cost of having Tax Depreciation Schedules prepared is 100% tax deductible, as long as they are prepared by a qualified Quantity Surveyor, and are a worthwhile investment.
Q3.What is a Tax Depreciation Schedule?
- Include depreciation on both Capital Allowances and Plant & Articles, by clearly identifying each depreciable item and providing accurate calculations and figures which can be legitimately claimed on your personal tax return
- Provide calculations and figures for the full depreciable lifetime of the property – up to 40 years
- Capture all improvements made to the property since its initial construction.
Unless you undertake major renovations to the property in the future, you should never need to have another report prepared for your property. For any improvements you make to the property, simply retain your receipts and forward these to your accountant who should be able to incorporate these additions into your existing Schedule.
Q4.How much Depreciation can I expect from my property?
Examples of depreciating expenses are as follows:
|Hot Water System||
|Formulae: asset cost x (365 days owned / 365) x (200% / effective life)
for assets held on or after 10 May 2006.
Examples of deductions for properties eligible to claim Capital Allowance depreciation
Q5.Isn’t Tax Depreciation only available on newer properties?
You will be surprised at the amount of depreciation available in older properties.
TSL Pty Ltd offers a Company Guarantee to all clients that “WE WILL FIND YOU AT LEAST DOUBLE YOUR FEE IN DEPRECIATION IN THE FIRST FULL CLAIMABLE YEAR, OR YOUR REPORT IS FREE”.
Q6.Do I need a new Tax Depreciation Schedule every tax year?
Q7.Can Tax Depreciation Schedules be transferred between owners of a property?
Q8.Why do you need to conduct an Inspection of my property?
- TSL Pty Ltd prides itself on operating under strict ATO and Australian Institute of Quantity Surveyors (AIQS) guidelines. In order to produce and certify a legitimate Tax Depreciation Schedule, we are required to conduct a full property inspection.
- We are able to identify, and assign a value to, every depreciable component of your investment property.
- We are able to identify all improvements and renovations to the property, some of which you may not even be aware of.
- We are able to take measurements of your property to accurately calculate things like carpets, window covering, etc, and to produce an indicative floor plan for inclusion in your Tax Depreciation Schedule.
- We take photographs of your property for inclusion in your Tax Depreciation Schedule.
Companies or individuals who prepare Tax Depreciation Schedules without conducting a full property inspection simply cannot certify that the calculations provided are legitimate and accurate.
Don’t risk it. Inferior Tax Depreciation Schedules will not withstand an ATO audit.
Q9.Am I able to Depreciate Improvements / Renovations to the property undertaken by previous owners?
Q10.What if I don’t have receipts for the Renovations / Improvements?
Q11.What if my property is fully or partially Furnished?
Q12.What if I make Improvements to the property in the future?
Q13.Is Depreciation available on Commercial Properties?
Q14.As the owner of a unit or apartment, am I entitled to claim Depreciation on Body Corporate or Common Areas in the complex?
Q15.When should I have a Tax Depreciation Schedule prepared for my property?
Q16.When can I start claiming Depreciation?
Q17.Does Depreciation affect Capital Gains Tax?
Keep in mind that the additional cash flow available from your depreciation can be utilised for additional repayments, adding value to your asset or as a guard against future vacancy. If you consider the indexing value, the money you receive from depreciating is worth far more today than some time in the future.
Q18.What do I do with my Tax Depreciation Schedule?
Q19.Who prepares Tax Depreciation Schedules?
This is a contradiction to previous and other legislation whereby a suitably qualified person, such as a Quantity Surveyor, should prepare such.
Based upon the recent and previous legislation, the AIQS have made representation to Parliament stating, in simple terms, that a qualified full member of the AIQS should not need to be a Registered Tax Agent.
In addition, the AIQ has advised all suitably qualified Member Quantity Surveyors that they will support their continued preparation of Tax Depreciation Schedules.
Hence, you should ensure a fully Qualified Quantity Surveyor, who is a Full Member of the AIQS prepares your Tax Depreciation Schedule to ensure it withstands an ATO audit.
The ATO continues to state that Valuers, Real Estate Agents, Accountants and Solicitors do not generally have the relevant qualifications or experience to assess and calculate Capital Allowance depreciation based upon construction costs. Qualified Quantity Surveyors are specialists in this industry and, as such, are identified by the ATO as the appropriate professionals to produce Tax Depreciation Schedules.top of page
A compromise on your Tax Depreciation Schedule will not withstand an ATO Audit.
Q20.What do I need to know when sourcing a Tax Depreciation Schedule?
- Are you a Qualified Quantity Surveyor?
- Are you a Full Member of the Australian Institute of Quantity Surveyors?
- Will you conduct a full inspection of my property?
- Will my Tax Depreciation Schedule cover the full depreciable lifetime of my property (up to 40 years)?
- Will my Tax Depreciation Schedule be certified by a Full Member of the Australian Institute of Quantity Surveyors?
- Is my fee fixed (ie, no hidden extras)?
- Do you provide your invoice for payment once my Tax Depreciation Schedule is completed, and not before?
- Do you offer a Company Guarantee?
If a company or individual answers ‘NO’ to any of these questions, do not engage their services. A fully Qualified Quantity Surveyor offering a reputable and professional service will answer ‘YES’ to all of these questions.
Q21.Why should I choose TSL Pty Ltd to prepare my Tax Depreciation Schedule?
- Tax Depreciation
- Building Cost Estimates
- Insurance Replacement Assessments
- Construction Contract Consulting and Management
- Expert Witness Reports
TSL Pty Ltd specialises in Tax Depreciation with a dedicated division in the field to help you maximise your tax benefits.
Owned and operated by Steve Lunniss, Director and Tracey Lunniss, Associate Director, together they have over 40 years of International Chartered Quantity Surveying experience and have provided integral QS services on International Projects in Europe, Asia, the Middle East and Australia. Both are full members of the Australian Institute of Quantity Surveyors (AIQS) and the Royal Institute of Chartered Surveyors (RICS). Tracey is the incumbent Secretary of the Queensland Chapter of the AIQS.
All Tax Depreciation Schedules completed by TSL are prepared by Qualified Quantity Surveyors and are fully certified by our Director (an Associate Member of the AIQS and RICS).top of page
Tax Depreciation Service
TSL Pty Ltd offers Tax Depreciation services Australia-wide and regularly assists clients residing overseas. Being mindful of the complexities of working in with all parties, TSL deal directly with Property Managers and / or Tenants to arrange property inspections providing a more personalised approach and delivering all the necessary property and body corporate searches as appropriate.
Conducting a comprehensive property inspection on every Tax Depreciation Schedule prepared ensures that all depreciable components of your property are identified. By engaging the services of TSL Pty Ltd you can feel confident knowing that your report will be correct and accurate and, most importantly – saving you dollars.
Tax Depreciation Schedules include:
- Depreciation calculations for both Capital Allowance (if applicable) and Plant & Articles depreciation for the full depreciable lifetime of your property (up to 40 years) using two different methods (Prime Cost and Diminishing Value – your Accountant will advise which is the most appropriate for you to use depending on your individual circumstances)
- Low value pooling items
- Photographs of the property
- An indicative floor plan of the property, if an original is not available
- All reports are emailed upon completion and certification in PDF format making it easy to forward this onto accountants, and you will also be posted a bound hard copy.
Fees and Charges
Depending on your location, size and complexity of task, costs may vary. However, when you receive a quote – it is a fixed fee. You can reduce your cost by $25.00 and take up the ‘special offer’ by requesting an emailed PDF copy of your report, and not a bound hard copy. Fees and charges include:
- 100% tax deductible
- No payment upfront – you receive our invoice with your completed Tax Depreciation Schedule
- Payment terms strictly 7 days
- Payments accepted via cheque, credit card and direct credit to our bank account.
Tax Depreciation Report + Insurance Replacement Assessment – Additional Service
Unfortunately, most investment properties are grossly underinsured. The good news is … TSL Pty Ltd offers an ‘Insurance Replacement Assessment’ in addition your Tax Depreciation Schedule.
This Insurance Replacement Assessment provides a full construction cost estimate to rebuild to a similar standard should the property ever be lost to fire, flood, natural disaster, etc. For a further investment of $150.00 inc GST you can take advantage of this additional service. You’ll have peace of mind knowing your investment is financially protected once insured for its true value.
Does TSL Pty Ltd offer me any Guarantee?
TSL Pty Ltd has complete confidence in our professional service and superior product. We take pride in offering our clients our Company Guarantee…
‘If we can’t find you at least double your fee in depreciation in the first full claimable year, your report is …. FREE’