Perth business owner claimed depreciation helped with cashflow

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 wages.  One deduction that is missed by many owners and leaseholders that can help with cashflow is the depreciation deduction.  

Our client Dammika who owns a restaurant in Perth claimed over $147,000 in depreciation deductions in the first full financial year of ownership!  See her results below. 

The ATO allows owners and leaseholders to claim the depreciation which is a tax deduction for the wear and tear on the building and assets.   

Depreciation falls under two categories Division 40 and Division 43.  Together, reported in a depreciation schedule they create substantial depreciation results with some owners or leaseholders claiming hundreds-of-thousands.  

Depreciation – Plant and Equipment Assets 

Plant and equipment assets which is also known as Division 40 are the removable assets within the building.  Examples of plant and equipment assets are – air conditioning, hot water systems, blinds and carpet.  

Depreciation – Capital Works 

Capital works which is also known as Division 43 is the structural component of the building. Examples of capital works are – bricks, walls, flooring, framing and shelving fixed to wall.  

Depreciation – Scrapping 

Scrapping is a term that is used when an old fit-out is removed and there is residual value left in those assets.  Owners and leaseholds can be entitled to claim for scrapping.   

Before you remove and throw out any assets, it is best to organise a quantity surveyor to inspect or photo evidence will need to be provided to claim. 

Case Study 

Our client Dammika purchased a restaurant in 2022.  Dammika completed a fit-out 6 months later in 2023 valued at $399,480 and removed the existing fit-out that had residual value of $55,448.  

Purchases of Division 40 plant and equipment assets included exhaust fans, range hoods, coffee machine, fridges, freezers, air-conditioning, crockery, cutlery and glasses.   

Dammika was entitled to claim for Division 43, Division 40 and Scrapping.  Here are Dammika’s depreciation results:  

How claiming for depreciation improved cash flow for this Perth business  » perth business depreciation

 

‘A friend told me about it claiming depreciation when I purchased my restaurant so I contacted Capital Claims.  I spoke with Alex who was easy to talk to and he answered all my questions as well as explained what I could claim. When I received my results, wow just wow, it really has helped me out financially.’ Dammika Hatfield. 

How do I claim for my commercial depreciation deduction? 

You need to organise an ATO compliant commercial depreciation schedule from a qualified quantity surveyor.  

Capital Claims Tax Depreciation has extensive knowledge and expertise in commercial depreciation for both owners and leaseholders.  

We have helped all types of commercial businesses from pubs and hospitality, accommodation, medical and dental practices, retail and supermarkets Australia-wide. 

How do I order my commercial depreciation deduction? 

Call and consult with either Mark Wilkins or Alex Konjarski today about your commercial property on 1300 922 220.  Together they have 40 years commercial depreciation experience and knowledge. Otherwise, if you would like a commercial property quote simply fill out our online quote form!    

Related Articles: 

The Power of Commercial Property Depreciation Deductions 

Depreciation Checklist for Commercial Property Owners 

What can I claim as a commercial tenant 

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