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This week on our blog, we’re taking a look at Tax Depreciation. Tax depreciation (also known as property depreciation) is a legitimate deduction against assessable taxable income, generated by a residential or commercial investment property.
While many investors believe that only properties built after 1985 can receive a depreciation benefit, the Australian Taxation Office (ATO) actually stipulates that those built after 18 July 1985 are eligible for depreciation on construction costs.
All properties contain depreciation entitlements, irrespective of age, many people underestimate entitlements on older properties. Regardless of the age of the property, there will almost always be deductions you can claim. These could include the cost of improvements prior to your purchase (for example, concreting, painting, renovations), and the value of the plant and equipment items within the property, such as blinds, carpets, stovetops, hot water systems etc.
Common areas and common plant can be depreciated and are often not claimed.
Rushing to renovate, rather than leaving for a “reasonable period” after purchase may cost you substantial plant allowances on demolished items.
Plant & Equipment
These items are depreciated at a higher rate than the building but are often bundled or overlooked.
Professionals Real Estate Tax Depreciation by Deppro (a leading property depreciation company) is a specialist service to assist property investors to claim full tax entitlements from their investment properties.
For more information, visit: http://sa.professionals.com.au/resources/tax-depreciation/ or please call 1300 888 489.