If you’ve engaged a builder, bought a house and land package, or constructed a brand new home yourself, then there is some great news!
- The 2017 Budget changes to depreciation don’t affect you (provided you never lived in the house yourself); and,
- We can generally complete your report at a lower fee, as we won’t have to conduct an inspection (provided you can supply us with the correct information)
Regarding the first point, the changes that restrict deductions on plant and equipment for second hand properties don’t apply to brand new properties. As a result, your depreciation claims will generally be much higher, especially in the early years of ownership.
Unfortunately, if you lived in the property as an owner occupier at any point, the plant and equipment assets are deemed to have been “previously used” and therefore ineligible to be claimed once you do start renting the property out. It’s not all bad news though, you can still claim on the Building Allowance, which for brand new property is usually quite substantial.
As for completing the depreciation schedule for a lower fee, there are three things we require you to provide:
- The total construction cost or purchase price
Generally, a copy of your building contract will satisfy this requirement, although make sure to include any post-contract variations.
If you organised the build yourself, a spreadsheet of all the costs incurred is required (e.g. Council fees, architect fees, trade costs, appliances, finishings, etc).
If the property was purchased as a house and land package, and the developer did not provide a cost split between the house and the land, then the total purchase price will suffice.
- Schedule of Finishes
Your builder will normally provide you with this before they commence construction. Often it is a document, around 10 pages long, listing all the inclusions the builder has agreed they will provide (sometimes with individual costs next to some of these inclusions).
For house and land packages, it is common for this list of inclusions to be displayed on just one or two pages.
Both types of schedule of finishes should include items such as the kitchen appliances, floor coverings, electrical fittings, air conditioning type, etc.
The final floor plans of your property are all we require for this step. However, if you have the electrical plan and/or floor coverings plan, they are often very useful too.
So, generally that’s all the extra information we require specifically for New Build properties. If you have further questions about any of these steps, or depreciation in general, email email@example.com and one of our depreciation experts will help you out.