Can you still depreciate Old Property

Can you still claim on old property?

Yes and no, the changes to depreciation laws mean that you can no longer claim plant & equipment depreciation on old property. However, you can still claim the building allowance if the property’s age is later than 1987.

If the you own a property that has post-1987 renovations, you are likely eligible to claim depreciation on these works.

You used to also be able to claim depreciation on previously used Plant & Equipment assets within a building. Now you can only depreciation on the structure of the building itself – known as the building allowance.

Are depreciation reports worthwhile on older properties?

The answer to that is – Sometimes. If the property was built prior to 1987 and has no renovations – then a depreciation schedule will probably not be of very much interest to you.

If, however, the property was built after 1987, then you will be eligible to claim the building allowance on the property.

What is the building allowance?

The building allowance relates to the structure of the building, that you as a property investor can claim depreciation deductions on.

Do I need an accountant or a Quantity Surveyor?

You need a quantity surveyor to work out the depreciation claim where the original construction costs are unknown.

The Tax Office put out a ruling in 1997 that only allows Quantity Surveyors to estimate the costs of the building where the costs are unknown.

Where to Start:

Depreciation on Old Property Articles:

How the new depreciation laws affect depreciation on old property

There is a common misconception in the property market that you cannot claim depreciation on old properties. This is wrong, and I can prove it! The origin of this myth centres on the fact that you cannot claim building depreciation on residential properties where the construction commencement date is before 1987. This is a true […]

Old vs New Property Depreciation – Washington Brown

Some people prefer to invest in brand-new properties while others opt for older properties that they can renovate and resell for profit. So, which is the better investment strategy? New vs old property? What’s difference in depreciation for new and old properties? Let’s have a look at some of the pros and cons of buying […]

What is Negative Gearing Investment Property? – Washington Brown

What is Negative Gearing Investment Property? Put simply, negative gearing is a tax benefit offered to investors on their borrowing costs. If your borrowing costs exceed the revenue gained from your investment, you are entitled to claim those losses against your total income. The benefit of gearing is that it allows you to own investments […]