Depreciation | info@renos.com.au | 1300 550 656

Depreciation

www.renos.com.au | info@renos.com.au | 1300 550 656

What is Depreciation?

• Hidden cash flow for property investors

• As buildings get older items wear out – they go down in value

• You can get a tax benefit for this!

• You can’t claim depreciation for your PPOR

What is Depreciation?

Must be carried out by a Quantity Surveyor (QS) then applied

by your accountant.

What is a Quantity Surveyor?

A specialist in building measurement and cost

estimating

Pre Construction

Construction

Post Construction

Tax Depreciation Estimates

• Gives prospective purchasers/investors an accurate figure of potential tax depreciation

• Helps to calculate the financial performance of a property investment

What is Depreciation?

Myth:

You can only get depreciation out of new or near new

buildings.

WRONG!

Depreciation

• There is no age restriction on Plant and Equipment.

• So when you buy an old property these effectively start a new life.

• This is why old buildings still have depreciation benefits.

Depreciation

Depreciation may include:

• The Building and built surrounds (i.e. carport)

• Plant and equipment (i.e. hot water system)

• Furniture

• Where in a unit block with Body Corp, common areas

Depreciation Example 1Furnished Unit Block

$385,856 over 9 years. They even depreciate the egg cups!

Depreciation Example 2Brand New Block of 10 x 1 Bed

Units

$81,000 first year!!!

Depreciation Example 3Old Block of 2 Flats

Scrapping value $15,000

Depreciation Example 4Old Furniture for the Dump

$40k to Vinnies

Depreciation Example 5Old House

Even a 30 year old building has

$54,178 of deductions!

Summary

• Depreciation is a paper loss only

• You get a tax break for this!

• MUST be done by a QS, NOT accountant

• Applies to old and new

• Can be back dated 2 years

• If you are an investor and haven’t got a depreciation schedule, we’ve just made you money!

What did you learn today?

Renovator not Ruinmaker The Reno KingsMaximizing Rent and Renting it Fast Colleen SutherlandInvestor Profile Matt CosgroveTax, Structures & Asset Protection Warren BlackFinance Kerri BurnessProperty Strategies The Reno KingsBrilliant Bathrooms & Killer Kitchens Paul EslickDepreciation The Reno Kings

TOMORROW: DAY 3 ADDING TREMENDOUS VALUE

The Reno Kings Adam Jones

Investor Profile

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