Sample Depreciation Report - Unit
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The Property Depreciation Experts
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
9-Dec-16
PurchaserDelivered via E-mail FILE NO:76482
Dear Purchaser,
Sample Unit, NSW 2127
Thank you for choosing Washington Brown to prepare your depreciation report.
Enclosed is our assessment of depreciation for the above property based upon
the Diminishing Value method and the Prime Cost method.
You will need to choose which method of depreciation you would like to claim.
Factors which may impact on your decision include:
1. Whether you have ever lived in the property.
2. The length of time you intend to own the property.
Generally speaking, if the property has been an investment from the settlement
date - property investors tend to choose the Diminishing Value method. This
method enables you to claim the depreciation faster.
However, if you have lived in the property at any time, you may wish to
consider the Prime Cost method as it slows down the depreciation in the earlier
years.
We recommend you always confirm with your accountant or financial advisor
the method that best suits your individual circumstances.
Further information about these two different methods has been provided to
you in the following pages.
Once you choose your method of claim, you cannot alternate between the two
options.
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
The year-end summary pages of this Schedule contain essential
information that summarises the amount your can claim annually.
Washington Brown Depreciation Pty. Ltd. does not accept any contractual,
tortious or other form of liability for any consequences, loss or damage
which may arise as a result of any other person acting upon or using this
valuation.
Regards,
Washington Brown Depreciation Pty Ltd
Registered Tax Agent 26956002
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
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Thanks for choosing Washington Brown
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Depreciation Schedule Fact Sheet
What is a depreciation schedule?
A depreciation schedule is a report supplied by a quantity surveyor after
inspection of an investment property. This report itemises fixtures and
fittings that can be depreciated and estimates their value. It also estimates
construction costs if these are not otherwise known.
What has the report been based upon?
We have based our assessment upon the information as provided, together
with the property inspection and our estimate of probable construction
costs.
What is this report used for?
This depreciation schedule has been prepared for the sole purpose of
depreciation claims to reduce investment owner's taxable income and may
not be used for any other purpose. This report will become void if you sell
this property. Future owners should contact this office to discuss any future
claims.
What is a depreciating asset?
A depreciating asset as defined in the Income Tax Assessment Act (ITAA)
1997 sect. 40-30(1), is an asset that has a limited effective life and can
reasonably be expected to decline in value over the time it is used.
The calculation of the amount of a deduction allowed with respect to a
depreciating asset in part depends upon the cost of that asset. The cost
has been determined by the amount you have paid for the depreciating
asset.
What is the Diminshing Value method of Depreciation
This method depreciates items more quickly up front. This method
recognises the fact that most Plant and Equipment items tend to lose a
higher portion of their value early on.
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What is the Prime Cost method of depreciation?
This method evenly spreads out the depreciation you can claim on Plant
and Equipment items.
What is the Building or Capital Works allowance?
This deduction relates to the construction costs of the building itself
(concrete and brickwork etc.). This allowance is calculated at either 2.5%
or 4% per annum based upon the original construction cost.
What is Plant and Equipment?
Plant and Equipment refers to items within a building, such as ovens,
dishwashers, carpets and blinds. The Plant and Equipment allowances
comprise of a number of categories which are claimed at different
percentages over their effective life.
What is effective life?
Also known as useful life, effective life is the length of the life of an item of
Plant and Equipment in an investment property as deemed by the tax
office. Each item can be depreciated over a period of its effective life.
When does the $300 immediate write off apply?
You can claim immediate deductions (i.e. 100% of the cost price) for items
costing $300 or less.
What is a Low Value Pool Item?
Items which cost more then $300 but less then $1000 can be allocated to a
low value pool and are depreciated at a 37.5% per year under the
Diminishing Value Method.
What are design and professional fees?
These fees include architect fees, engineering costs and any other design
fees involved in creating a property.
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What are builder's preliminaries?
These costs relate to items such as scaffolding, materials, handling
insurances and labour costs.
What are owner inclusions?
This relates to the work or additions that you made to your property after
settlement of the property.
What if I co-own my property?
Where depreciating assets are co-owned, the individual's interest (share) in
the asset is applicable. Each co-owner therefore must treat their
depreciating asset (their interest in the underlying asset) in accordance
with their own tax profile.
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
Property Address Sample Unit, NSW 2127
Purchase Price Of Property $650,000
Settlement Date July 1, 2016
Year Of Construction 2016
Your Property Details
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
CERTIFICATE OF DEPRECIATION
We hereby certify that the following costs in our opinion relate to the Plant and Equipment as
included within the Purchase Contract between the relevant parties. This certification is in
accordance with Division 40 of the Income Tax Assessment Act 1997.
We hereby certify that the following costs in our opinion relate to the Capital Works Allowance
as included within the Purchase Contract between the relevant parties. This certification is in
accordance with Division 43 of the Income Tax Assessment Act 1997.
The depreciation of the Plant and Equipment in this depreciation schedule has been determined
in accordance with the relevant legislation at the time of writing this report.
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
DEPRECIATION SCHEDULE
BASED UPON
THE DIMINISHING VALUE METHOD
This method depreciates items at a greater rate in the beginning. This method
recognises the fact that most plant and equipment items tend to lose a higher portion
of their value to begin with.
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
DATE: 9-Dec-16
JOB: 76482
DESCRIPTION VALUE CALCULATIONS
PURCHASE PRICE $650,000
BUILDING COST $258,866
ADD
BUILDERS PRELIMINARIES $38,027
ADD
PROFESSIONAL FEES $9,293
TOTAL CONSTRUCTION COSTS $306,187 $306,187
LESS
TOTAL INSTALLED COST OF PLANT & EQUIPMENT $25,338
LESS
ALLOWANCE FOR ITEMS NOT
ELIGIBLE FOR DEPRECIATION: $2,694
LESS
TOTAL VALUE OF LOW POOL ITEMS $2,938
SUB TOTAL $30,971 -$30,971
BUILDING ALLOWANCE – SECTION 43 (INITIAL STRUCTURE) $275,216
PROJECT: Sample Unit, NSW 2127
CLIENT: Purchaser
CONSTRUCTION SUMMARY - DIMINISHING VALUE METHOD
DEPRECIATION & BUILDING ALLOWANCES BASED ON THE DIMINISHING VALUE METHOD AS OUTLINED IN THE
NEW BUSINESS TAX SYSTEM (CAPITAL ALLOWANCES ) ACT1999.
AMENDMENTS TO INCOME TAX ASSESSMENT ACT 1997 BY
NEW BUSINESS TAX SYSTEM (CAPITAL ALLOWANCES) ACT 1999
(ACT 164 of 1999, ROYAL ASSENT 10 DECEMBER 1999).
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
PROJECT: Sample Unit, NSW 2127 DATE: 9-Dec-16
CLIENT: Purchaser JOB: 76482
Category : ASSETS GENERALLY (11 items)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Air Conditioning - Mini split systems 3,112$ 10 20% 3,112$
Door closers 274$ <= $300** 100% 274$
Floor coverings - Carpet 4,532$ 10 20% 4,532$
Floor coverings - Carpet (Common) 229$ <= $300** 100% 229$
Floor coverings - Floating timber 1,421$ 15 13.34% 1,421$
Hot water systems (excluding piping) 2,018$ 12 16.66% 2,018$
Lights - Fittings (Common) 364$ <= $300** 100% 364$
Lights - Fittings (excluding hardwired) 2,604$ <= $300** 100% 2,604$
Master antenna television (MATV) assets 291$ <= $300** 100% 291$
Ventilation fans 1,273$ 20 10% 1,273$
Window blinds, internal 1,715$ <= $300** 100% 1,715$
Category : BATHROOM ASSETS (1 item)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Exhaust fans 548$ <= $300** 100% 548$
SCHEDULE OF DEPRECIABLE ITEMS BASED UPON THE DIMINISHING VALUE METHOD
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
Category : FIRE CONTROL ASSETS (2 items)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Alarms- Heat & smoke 459$ <= $300** 100% 459$
Extinguishers 114$ <= $300** 100% 114$
Category : KITCHEN ASSETS (3 items)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Cook top 1,194$ 12 16.67% 1,194$
Dishwasher 1,408$ 10 20% 1,408$
Oven 1,715$ 12 16.67% 1,715$
Category : LAUNDRY ASSETS (1 item)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Exhaust fans 243$ <= $300** 100% 243$
Category : OUTDOOR ASSETS (2 items)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Automatic garage doors - Controls 148$ <= $300** 100% 148$
Clothesline 297$ <= $300** 100% 297$
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
Category : SECURITY & MONITORING ASSETS (1 item)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Access control systems - Code pads & door controllers 1,379$ 5 40% 1,379$
VALUE OF PLANT ITEMS 25,338$ 25,338$
** Indicates items that are less than or equal to $300.00.
Category : LOW VALUE POOL ITEMS (4 items)
Depreciable Item Cost Effective
Life (DV)
Diminishing
Value Opening WDV
Water pumps 449$ Low Pool* 18.75% 449$
Range hood 857$ Low Pool* 18.75% 857$
Clothes dryer 796$ Low Pool* 18.75% 796$
Automatic garage doors - Motors 836$ Low Pool* 18.75% 836$
VALUE OF LOW POOL ITEMS 2,938$ 2,938$
Category : BUILDING ALLOWANCE (Capital Works)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Building allowance 275,216$ 40 2.50% 275,216$
VALUE OF BUILDING ALLOWANCE 275,216$ 275,216$
* Indicates items allocated to Low Pool Category. These items must be calculated using Diminishing Value Method. Low Pool items are depreciated at
18.75% in the year of acquisition. In the following year the opening tax value of the pool is written down using the Diminishing Value rate of 37.5% p.a.
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FINANCIAL YEAR DEPRECIATION LOW VALUE CAPITAL WORKS
END PLANT & EQUIPMENT POOL ITEMS DEDUCTIONS
2016 / 2017 $10,786 $551 $6,880 $18,217
2017 / 2018 $2,742 $895 $6,880 $10,518
2018 / 2019 $2,173 $560 $6,880 $9,613
2019 / 2020 $1,737 $350 $6,880 $8,968
2020 / 2021 $1,399 $219 $6,880 $8,498
2021 / 2022 $1,134 $137 $6,880 $8,151
2022 / 2023 $923 $85 $6,880 $7,889
2023 / 2024 $755 $53 $6,880 $7,689
2024 / 2025 $619 $33 $6,880 $7,533
2025 / 2026 $509 $21 $6,880 $7,411
2026 / 2027 $420 $13 $6,880 $7,313
2027 / 2028 $347 $8 $6,880 $7,236
2028 / 2029 $288 $5 $6,880 $7,173
2029 / 2030 $239 $3 $6,880 $7,122
2030 / 2031 $199 $2 $6,880 $7,081
2031 / 2032 $166 $1 $6,880 $7,047
2032 / 2033 $138 $1 $6,880 $7,019
2033 / 2034 $116 $0 $6,880 $6,997
2034 / 2035 $97 $0 $6,880 $6,978
2035 / 2036 $82 $0 $6,880 $6,962
2036 / 2037 $69 $0 $6,880 $6,949
2037 / 2038 $58 $0 $6,880 $6,938
2038 / 2039 $49 $0 $6,880 $6,929
2039 / 2040 $41 $0 $6,880 $6,922
2040 / 2041 $35 $0 $6,880 $6,916
2041 / 2042 $30 $0 $6,880 $6,910
2042 / 2043 $25 $0 $6,880 $6,906
2043 / 2044 $22 $0 $6,880 $6,902
2044 / 2045 $19 $0 $6,880 $6,899
2045 / 2046 $16 $0 $6,880 $6,896
2046 / 2047 $14 $0 $6,880 $6,894
2047 / 2048 $12 $0 $6,880 $6,892
2048 / 2049 $10 $0 $6,880 $6,891
2049 / 2050 $9 $0 $6,880 $6,889
2050 / 2051 $8 $0 $6,880 $6,888
2051 / 2052 $7 $0 $6,880 $6,887
2052 / 2053 $6 $0 $6,880 $6,886
2053 / 2054 $5 $0 $6,880 $6,885
2054 / 2055 $4 $0 $6,880 $6,885
2055 / 2056 $4 $0 $6,880 $6,884
2056 / 2057 $3 $0 $0 $3
DIMINISHING VALUE - YEAR END SUMMARY
Sample Unit, NSW 2127
AMOUNT CLAIMABLE
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
DEPRECIATION SCHEDULE
BASED UPON
THE PRIME COST METHOD
This method evenly spreads out the depreciation you can claim on Plant and
Equipment items.
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
DATE: 9-Dec-16
JOB: 76482
DESCRIPTION VALUE CALCULATIONS
PURCHASE PRICE $650,000
BUILDING COST $258,866
ADD
BUILDERS PRELIMINARIES $38,027
ADD
PROFESSIONAL FEES $9,293
TOTAL CONSTRUCTION COSTS $306,187 $306,187
LESS
TOTAL INSTALLED COST OF PLANT & EQUIPMENT $28,276
LESS
ALLOWANCE FOR ITEMS NOT
ELIGIBLE FOR DEPRECIATION: $2,694
SUB TOTAL $30,971 -$30,971
BUILDING ALLOWANCE – SECTION 43 (INITIAL STRUCTURE) $275,216
PROJECT: Sample Unit, NSW 2127
CLIENT: Purchaser
CONSTRUCTION SUMMARY - PRIME COST METHOD
DEPRECIATION & BUILDING ALLOWANCES BASED ON THE PRIME COST METHOD AS OUTLINED IN THE
NEW BUSINESS TAX SYSTEM (CAPITAL ALLOWANCES ) ACT1999.
AMENDMENTS TO INCOME TAX ASSESSMENT ACT 1997 BY
NEW BUSINESS TAX SYSTEM (CAPITAL ALLOWANCES) ACT 1999
(ACT 164 of 1999, ROYAL ASSENT 10 DECEMBER 1999).
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
PROJECT: Sample Unit, NSW 2127 DATE: 9-Dec-16
CLIENT: Purchaser JOB: 76482
Category : ASSETS GENERALLY (12 items)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Air Conditioning - Mini split systems 3,112$ 10 10% 3,112$
Door closers 274$ 10 10% 274$
Floor coverings - Carpet 4,532$ 10 10% 4,532$
Floor coverings - Carpet (Common) 229$ 10 10% 229$
Floor coverings - Floating timber 1,421$ 15 6.67% 1,421$
Hot water systems (excluding piping) 2,018$ 12 8.33% 2,018$
Lights - Fittings (Common) 364$ 5 20% 364$
Lights - Fittings (excluding hardwired) 2,604$ 5 20% 2,604$
Master antenna television (MATV) assets 291$ 10 10% 291$
Ventilation fans 1,273$ 20 5% 1,273$
Water pumps 449$ 20 5% 449$
Window blinds, internal 1,715$ 10 10% 1,715$
SCHEDULE OF DEPRECIABLE ITEMS BASED UPON THE PRIME COST METHOD
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
Category : BATHROOM ASSETS (1 item)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Exhaust fans 548$ 10 10% 548$
Category : FIRE CONTROL ASSETS (2 items)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Alarms- Heat & smoke 459$ 6 16.67% 459$
Extinguishers 114$ 15 6.67% 114$
Category : KITCHEN ASSETS (4 items)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Cook top 1,194$ 12 8.33% 1,194$
Dishwasher 1,408$ 10 10% 1,408$
Oven 1,715$ 12 8.33% 1,715$
Range hood 857$ 12 8.33% 857$
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P: 1300 99 06 12 F: 1300 99 06 13 E: [email protected] W: www.washingtonbrown.com.au
Category : LAUNDRY ASSETS (2 items)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Clothes dryer 796$ 10 10% 796$
Exhaust fans 243$ 10 10% 243$
Category : OUTDOOR ASSETS (3 items)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Automatic garage doors - Controls 148$ 5 20% 148$
Automatic garage doors - Motors 836$ 10 10% 836$
Clothesline 297$ 5 20% 297$
Category : SECURITY & MONITORING ASSETS (1 item)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Access control systems - Code pads & door controllers 1,379$ 5 20% 1,379$
VALUE OF PLANT ITEMS 28,276$ 28,276$
Category : BUILDING ALLOWANCE (Capital Works)
Depreciable Item Cost Effective
Life (PC)Prime Cost Opening WDV
Building allowance 275,216$ 40 2.50% 275,216$
VALUE OF BUILDING ALLOWANCE 275,216$ 275,216$
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FINANCIAL YEAR DEPRECIATION CAPITAL WORKS
END PLANT & EQUIPMENT DEDUCTIONS
2016 / 2017 $3,104 $6,880 $9,984
2017 / 2018 $3,104 $6,880 $9,984
2018 / 2019 $3,104 $6,880 $9,984
2019 / 2020 $3,104 $6,880 $9,984
2020 / 2021 $3,104 $6,880 $9,984
2021 / 2022 $2,145 $6,880 $9,026
2022 / 2023 $2,069 $6,880 $8,949
2023 / 2024 $2,069 $6,880 $8,949
2024 / 2025 $2,069 $6,880 $8,949
2025 / 2026 $2,069 $6,880 $8,949
2026 / 2027 $670 $6,880 $7,551
2027 / 2028 $670 $6,880 $7,551
2028 / 2029 $188 $6,880 $7,069
2029 / 2030 $188 $6,880 $7,069
2030 / 2031 $188 $6,880 $7,069
2031 / 2032 $86 $6,880 $6,967
2032 / 2033 $86 $6,880 $6,967
2033 / 2034 $86 $6,880 $6,967
2034 / 2035 $86 $6,880 $6,967
2035 / 2036 $86 $6,880 $6,967
2036 / 2037 $0 $6,880 $6,880
2037 / 2038 $0 $6,880 $6,880
2038 / 2039 $0 $6,880 $6,880
2039 / 2040 $0 $6,880 $6,880
2040 / 2041 $0 $6,880 $6,880
2041 / 2042 $0 $6,880 $6,880
2042 / 2043 $0 $6,880 $6,880
2043 / 2044 $0 $6,880 $6,880
2044 / 2045 $0 $6,880 $6,880
2045 / 2046 $0 $6,880 $6,880
2046 / 2047 $0 $6,880 $6,880
2047 / 2048 $0 $6,880 $6,880
2048 / 2049 $0 $6,880 $6,880
2049 / 2050 $0 $6,880 $6,880
2050 / 2051 $0 $6,880 $6,880
2051 / 2052 $0 $6,880 $6,880
2052 / 2053 $0 $6,880 $6,880
2053 / 2054 $0 $6,880 $6,880
2054 / 2055 $0 $6,880 $6,880
2055 / 2056 $0 $6,880 $6,880
2056 / 2057 $0 $0 $0
PRIME COST - YEAR END SUMMARY
Sample Unit, NSW 2127
AMOUNT CLAIMABLE
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$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
$200,000
2016 / 2
017
2018 / 2
019
2020 / 2
021
2022 / 2
023
2024 / 2
025
2026 / 2
027
2028 / 2
029
2030 / 2
031
2032 / 2
033
2034 / 2
035
2036 / 2
037
Diminishing Value Method Vs. Prime Cost Method
Diminishing Value Method Prime Cost Method
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