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Commercial Property Depreciation Articles
How claiming for depreciation improved cash flow for this Perth business
Running a business can be quite expensive. Seeing money going out to pay for rent, bank loans, stock purchases and
Claiming depreciation for SMSF commercial properties
Investing in commercial properties within a Self-Managed Super Fund (SMSF) presents a strategic avenue for optimising returns and enjoying unique
Accelerated tax deductions when renovating and refurbishing your hotel
The Australian Taxation Office (ATO) allows hoteliers and publicans (along with all other commercial property owners and tenants) to claim
Commercial Depreciation FAQs
- Who Can Claim Commercial Depreciation?
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Commercial property owners can claim depreciation on both the building structure and any included plant and equipment (e.g., air conditioning, fire safety systems).
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Tenants (lessees) can claim depreciation on any fit-out or improvements they pay for in the premises.
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Owner-occupiers operating a business from a commercial building they own can claim depreciation on both the building and the assets to reduce taxable business income.
No matter your position, a professionally prepared depreciation schedule ensures you don’t miss out on valuable deductions.
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- What Can Be Claimed in a Commercial Depreciation Schedule?
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Division 43 – Capital Works
Deductions for the structural elements of the building (e.g., walls, floors, roof, concrete slabs), usually at 2.5% per year over 40 years, though this can vary dependent upon the building use and construction date. -
Division 40 – Plant and Equipment
Depreciable assets that can be removed or replaced, such as:-
Hot water systems
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Air conditioning units
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Security systems
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Fire safety equipment
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Lighting and fittings
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Commercial kitchen equipment (for hospitality premises)
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Tenant Fit-Outs
Assets or structural improvements paid for by the tenant—such as partitions, counters, shelving, or display units—can also be claimed by the tenant over their effective life.
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- Do I Need a Quantity Surveyor to Prepare My Commercial Depreciation Schedule?
Commercial property depreciation is complex and highly individual, depending on:
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Property type (e.g., office, warehouse, retail, medical suite)
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Age and construction history
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Use and fit-out
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Ownership vs. tenancy agreements
That’s why it’s essential to use a qualified quantity surveyor who understands commercial property legislation and ATO compliance.
At Capital Claims Tax Depreciation, we:
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Inspect your property (nationwide)
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Identify all eligible assets and structure
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Provide a fully compliant, maximised report
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Deliver a one-time report you can use for the life of your ownership
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Liaise directly with your accountant if needed
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- How Much Depreciation Can You Claim on Commercial Property?
The amount of depreciation you can claim for your commercial property depends on several factors.
These include the property’s age, the types of assets it contains, and their respective effective lives.
Generally, newer properties with a higher proportion of plant and equipment assets yield higher depreciation deductions.
To ascertain a more specific estimate of deductions for your property, it’s advisable to enlist the assistance of professionals such as Capital Claims who can conduct a thorough assessment tailored to you.
- How Do You Calculate Depreciation on a Commercial Property?
Calculating depreciation for a commercial property involves two primary categories: Capital Works Deductions (Division 43) and Plant and Equipment Deductions (Division 40).
Capital Works deductions encompass structural elements like walls, roofs, and floors, and their calculation depends on the property’s construction cost and age.
Plant and Equipment deductions pertain to assets within the property, such as appliances and systems, and their depreciation is determined by their individual effective lives and depreciation rates as defined by the Australian Taxation Office (ATO).
- What Is the Depreciation Rate for Commercial Buildings in Australia?
Depreciation rates for commercial buildings in Australia can vary widely. They are influenced by factors such as the type of assets, their effective lives, and their applicable depreciation rates as outlined by the ATO.
- Do Older Commercial Properties Still Qualify for Depreciation?
Yes. Even if your building is older, it may qualify for Capital Works deductions if constructed after 20 July 1982. Plus, Plant and Equipment assets are eligible for all commercial properties.
- Can Tenants Claim Depreciation on Leased Premises?
Yes. Tenants can claim depreciation on any assets or improvements they fund in the property.
- What If I Have Renovated or Refurbished My Commercial Property?
Any renovations or capital improvements—by you or a previous owner—may be depreciable. We review historical and recent works to ensure you’re claiming everything possible.
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Would definitely recommend. Highly professional service. They prepared our depreciation report with 7 days really impressive. Was very quick n prompt. Thanks Nadine
Nadine was very friendly, helpful, informative and kept in contact with us over several months while our property was being finalised. The report was completed promptly. Thank you.
They responded promptly to my request for a quote for a property depreciation report, kept me informed of progress and completed my report much quicker than I expected.
Not only they managed to fit me in their very busy EOFY schedule but they emailed me with updates during all process. Great work! I’d recommend them to anyone.
They were fantastic to deal with, very helpful and super efficient - all our reports were produced in quick time. They were also great value, coming in much cheaper than the competition.
Always fantastic work guys. I've used Capital claims personally, I recommend to family and have recommended to clients. Punctual and great value. A must do investment for investors.
Would definitely recommend. Highly professional service. They prepared our depreciation report with 7 days really impressive. Was very quick n prompt. Thanks Nadine
Nadine was very friendly, helpful, informative and kept in contact with us over several months while our property was being finalised. The report was completed promptly. Thank you.
They responded promptly to my request for a quote for a property depreciation report, kept me informed of progress and completed my report much quicker than I expected.
Not only they managed to fit me in their very busy EOFY schedule but they emailed me with updates during all process. Great work! I’d recommend them to anyone.
They were fantastic to deal with, very helpful and super efficient - all our reports were produced in quick time. They were also great value, coming in much cheaper than the competition.