We like to keep the process for ordering your tax depreciation schedule as simple as possible. The only information we need to start the process is the address of your investment property, and an approximate date of purchase.
The following list outlines the information we will require in order to complete your schedule.
If you are having difficulty finding the details, please don’t be concerned, we will be able to further assist:
If your property is brand new and you have been quoted a discounted fee, we will ask you to provide to us:
Market fees for depreciation schedules can range from a few hundred dollars to over $700.
Our fee will depend on the property – commercial or residential, and whether the property is brand new or established, and how much information is available.
Our fees for brand new properties typically start from $440 (though discounts apply for clients of some large developers with bulk orders).
Our fees for established residential properties typically range from $590.00 to $690.00.
Commercial fees are quoted based on the building and scope of works.
No, accountants can apply actual costs, but are not qualified to estimate construction costs. Tax Ruling 97/25 of the Income Tax Assessment Act (1997) specifically states that “valuers, real estate agents, accountants and solicitors generally have neither the relevant qualifications nor experience to make such an estimate.”
A tax depreciation schedule is much more than just a table of costs. In order to fully maximise your claim, and to save your accountant time (which ultimately saves you money) you need to ensure your quantity surveyor will provide the following:
Depending on the scope of work and availability of your tenants, we can usually gain access within a week of you giving us the instruction to proceed. Our turnaround from inspection is approx 5-7 business days – the fastest in the industry.
Definitely! It’s all about maximising your tax deductions and putting as much money as we can back in your pocket. You will be asked at the enquiry stage if you have added any improvements, which we will include in the depreciation schedule at no extra cost.
Where necessary, we will also conduct a thorough inspection and historical records search in an attempt to uncover any works the previous owners may have carried out on the building. If we find the right evidence, our expertise allows us to estimate a value that can be included in your tax assessment.
It would depend on how long ago you bought property, but in most cases yes. Ordinarily we aim to maximise tax depreciation deductions immediately upon purchase of the property.
However, as you are unable to claim tax depreciation for the period you were living there, we will re-structure the schedule (within the ATO guidelines) to minimise the depreciation claimed for the period you occupied the building and maximise depreciation in the period it was leased, or available for lease.
Once the depreciation schedule is complete and the invoice has been settled a soft copy will be emailed to you and your accountant. The best thing about our depreciation schedules is that they provide a complete summary of claims for your accountant to include in your tax assessment. This saves your accountant time, which in turn saves you money over and above the tax savings represented in the schedule.
We are available for consultation with your accountant at all times either before, during or after the schedule is complete. In fact we enjoy solid working relationships with many accountants who benefit from this level of service, so we’re more than happy to deal directly with your accountant if that is more convenient for you.
This can sometimes be a little bit of a grey area, and you need to make sure you are not claiming improvements as repairs, and vice versa. Generally speaking, a repair is something which restores an asset back to its original condition. For example: if you bought a brand new investment property, and the tenants scratched some paint off the walls while moving furniture, when you paint that wall you are repairing or restoring it back to the condition it was in when you first bought it. This would be considered a repair, which you could write off immediately.
However, if you bought an existing property and decided to paint the walls in an effort to improve the condition of the building from when you first purchased it, this would be considered a capital improvement which you would write off annually at 2.5% per annum (for a residential property).
Our tax depreciation schedules last you for the life time of the building, assuming it remains in the condition it was in when we conducted the initial inspection. If you add minor improvements over the years such as a new hot water heater, or you added a swimming pool or garage, simply send your costs in to our office and in most cases we can update your schedule free of charge.
The only time you would need a second schedule was if you carried out substantial renovations/refurbishments from the time that the original tax depreciation schedule was compiled.
We have had discussions with some property investors who chose not to claim the division 43 capital works allowance, because they were afraid that it would reduce their cost base, and therefore increase their Capital Gains Tax liability if/when they sell the property. A couple of things those investors may not have considered:
Most importantly, for compliance purposes your quantity surveyor must be a registered tax agent with the Tax Practitioners Board. For further assurance your quantity surveyor should also be a member of the Australian Institute of Quantity Surveyors.
Following that, your quantity surveyor should have at least 5 years experience in preparing capital allowance and tax depreciation schedules that are tailored specifically to the investor’s financial situation. A tax depreciation schedule is not just a table of costs and dates; it is a complete exercise that requires the utmost attention to detail both in the office and sometimes onsite. Your quantity surveyor should be able to provide over the phone estimates of the potential claims you could expect to make as an investor, and then follow through with an accurate schedule. Your quantity surveyor should be available for consultation to you and/or your accountant as often as required either before, during or after the schedule is complete.
We suggest using a quantity surveyor that has been operating for a number of years, with evidence of a qualified and experienced team. You want your quantity surveyor to still be around in the case of an audit, a report update or a lost report. The quantity surveyor should also be responsible for arranging access to the property and should bear the cost of any travel expenses or council/authority searches that may be required to fulfil their service promise to you. And finally, your quantity surveyor should also have the integrity to advise you not to proceed with the tax depreciation schedule if they feel the outcome will not be substantially in your favour.
We’ll include an estimate of available deductions, and if we can’t guarantee a strong result, we’ll let you know up front and there will be no cost to you.