Do you get more depreciation on a new or old property?
After the depreciation tax laws changes in 2017 – you definitely get more depreciation on a newer property.
The changes to depreciation in 2017 meant that you could no longer claim depreciation on second-hand Plant & Equipment assets. This has led to brand-new property having much higher depreciation claims.
Also, construction costs have historically risen over the years. So a house built in 1990 would have a lower construction cost than an equivalent one built in 2010, meaning the depreciation claim would be lower.
How does depreciation on a new rental property work?
Since the 2017 Federal Budget changes, you are still able to claim both the Plant & Equipment and Building Allowance deductions on brand new property.
This means you will be entitled to the maximum depreciation claims, provided the house remains as an income-producing asset.
Compared to an older property, where you are not entitled to claim deductions on the previously used Plant & Equipment, the difference in deductions could be well into the thousands.
Do I need a Quantity Surveyor or an Accountant?
You need a Quantity Surveyor to prepare your depreciation schedule. The ATO has stated that a Quantity Surveyor is eligible to estimate building costs where they are not known.
Washington Brown have prepared depreciation schedules for hundreds of thousands of properties. Start claiming deductions and request a free, online quote.
