Depreciation Schedules That Maximise Your Property Tax Savings
Backed by 40+ Years of Experience and 315,000+ Reports
In Australia’s vibrant property market, shrewd investors know the power of maximising every single opportunity to boost their returns … depreciation schedules are a formidable tool to unlock your property’s incredible financial potential.
They transform your investment property’s inherent wear and tear into serious, and ongoing, tax deductions. In real terms, this can mean impressive tax savings, elevated cash flow, and often welcome tax refunds.
And here’s the best news… depreciation schedules prepared by registered tax agents and quantity surveyors are governed by the ATO in accordance with TR97/25.
Without one, you could be losing thousands of dollars in saving entitlements every year … as do many investors. Let Washington Brown, Australia’s leading depreciation schedule experts, guide you through how they work … allowing you to supercharge your investment property gains.
What Is a Depreciation Schedule?
As the days, months, and years pass, your investment property naturally experiences wear and tear: from doors to carpets, and fencing to windows. These structural and fitting assets lose value as both time and tenants take their heavy toll, i.e. they depreciate.
Tax depreciation schedules give you, and perhaps most importantly, your accountant, a detailed report of this wear and tear. They outline what you can legally claim as a tax deduction due to its declining value over its life. Effectively, you can look at it as a form of compensation for the value you’re losing.
Whether you own residential or commercial investment properties, you can make these claims with your property depreciation schedules every year. They can save you thousands of dollars, improving your cash flow position, and ultimately adding more hard-earned cash to your pocket.
Washington Brown’s depreciation schedule experts professionally scrutinise your property. We ensure all your allowable depreciable items are utilised, and ensure your report is fully compliant with the Income Tax Assessment Act and ATO guidelines.
Why Choose Washington Brown for Your Depreciation Schedule?
Because we are Australia’s trusted depreciation specialist.
Over the years, we have become renowned for our precision, customer focus, and relentless determination, ensuring clients receive the full extent of their allowable deductions.
Backed by a vast resource of historical data, driven by a knowledgeable team of depreciation professionals, and with a 100 percent depreciation schedule acceptance rate by the ATO, our sole purpose is to maximise your tax savings.
The Reasons Property Investors and Accountants Consistently Choose Us:
Opting for Washington Brown means you enjoy peace of mind, maximum deductions, the ultimate in tax efficiency, and a partner that’s genuinely invested in you and your property’s financial success for the long term.
What Is Included in a Depreciation Schedule?
Your depreciation schedule is a comprehensive, definitive document. It converts your property’s wear and tear into real, substantial, and ongoing tax savings.
When you receive a depreciation report from Washington Brown, you gain an ATO-compliant, precise, and powerful tool prepared by our very own schedule specialists.
A Typical Depreciation Schedule Includes:
- 40-year forecast – showing a projection of eligible deductions for up to 40 years from the property’s construction date.
- Breakdown of Division 40 (plant and equipment) – all the removable assets in your investment property, their lifespan and depreciation rates.
- Breakdown of Division 43 (capital works) – the depreciation of the building’s structural parts and fixed assets, and applicable deductions.
- Depreciation methods – depreciation calculations using either prime cost or diminishing value methods, depending on your accountant’s needs.
- Low-value pooling and instant asset write-offs – showing assets eligible for faster write-offs to boost cash flow early.
- Past renovation details – where relevant, illustrating renovations completed by previous owners.
- Glossary – to ensure clarity, helping you, your accountant, and other stakeholders to easily understand the document.
- Year-end summary – the total claim per financial year, already calculated on a pro rata basis, dependent on your construction or settlement completion date.
- Graph page – illustrating your total claims over the life of your property.
And, we know that for some, making sense of these in-depth reports can be challenging. So, we’ve compiled a handy guide to reading your report, allowing you to understand exactly how it empowers your investment plans.
How Does a Depreciation Schedule Affect My Taxes?
Perhaps the most important question! With a depreciation schedule, you subtract the wear and tear on your investment property from your taxable income, which brings the benefits of:
- Reducing your taxable income – every year, your wear and tear lowers your taxable income, meaning a lower tax bill.
- Boosting your cash flow – when you pay lower taxes, you have more cash in your pocket.
- Delivering long-term savings – your depreciation schedule can give allowable deductions for up to 40 years, an ongoing stream of tax benefits!
An Example of the Power of Depreciation Schedules on Tax
|
Scenario |
Amount (AUD) |
|---|---|
|
You Purchase a New Apartment |
$559,000 |
|
Annual Rental Income at $620 per week |
$32,240 |
|
Annual Interest – 80% loan at 5.5% |
-$24,596 |
|
Other Expenses (rates, management fees, etc.) |
-$8,385 |
|
Cash Flow Position |
-$741 |
After the first year, you’re in a negative cash position, having to find $741 out of your own pocket to keep your investment property up and running.
But, here’s what happens with a depreciation schedule:
|
Scenario |
Amount (AUD) |
|---|---|
|
Negative Cash Flow Before Depreciation (from above) |
-$741 |
|
First Year Depreciation Identified by Washington Brown |
-$15,000 |
|
Total Taxable Loss |
-$15,741 |
|
Tax Refund (in 37% tax bracket) |
$5,824 |
|
Net Cash Flow (Thank You, Depreciation!) |
+$5,083 |
Impressed? See How Much You Could Save NOW!
The Tax Depreciation Schedule – Divisions 40 and 43 Explained
While the terms Division 40 and 43 may initially seem technical and uninspiring, their potential impacts on investors are significant. These powerful financial instruments deliver strategic tax advantages that are unparalleled in most international property markets.
Australian depreciation schedules are generally split into two key categories: Division 40 (wear and tear on removable assets, like cupboards, lights and carpet) and Division 43 (structural assets, such as concrete, bricks and walls). That means you can claim deductions on virtually every aspect of your building, as the years pass.
Compared to the allowances in similar developed countries, such as the United Kingdom, the Australian system is far more generous. For taxpayers in the UK, residential property isn’t eligible for depreciation, and commercial property can only benefit from restrictive capital allowances.
Therefore, to capitalise fully on the generous provisions of Divisions 40 and 43, and ensure you claim what’s rightfully yours, speak to Washington Brown.
How Are Assets Classified in a Depreciation Schedule?
Division 40 (Plant and Equipment)
Generally speaking, Division 40 deductions include assets such as fittings and fixtures. That is, items that you can effortlessly remove from your property. This could be dishwashers, ovens, carpets, hot water heaters, air-con, curtains, and lighting.
How much they depreciate depends on their effective life (which varies across assets) stated by the Australian Tax Office (ATO). Washington Brown’s specialists make sure that all your relevant fixtures and fittings are both identified and depreciated correctly to maximise your claim.
You can only claim these items in residential property if they are brand new and you are the first owner of that property. In commercial property, they can be acquired second hand.
Division 43 (Capital Works)
Referred to as either Capital Works or Building Write-Off deductions, Division 43 covers the depreciation of the structural parts of your investment property.
This can comprise the roof, walls, building improvements, concrete, bricks, and earthworks. At Washington Brown, our team of experienced depreciation experts deliver an unsurpassed ability to calculate depreciation and estimate historical construction costs to maximise your tax efficiencies.
Calculate Your Division 40 and 43 Eligible Deductions
How Much Can Your Depreciation Schedule Help You Claim?
Perhaps the most pressing question on property investors’ minds, and the answer is, surprisingly more than you think. The amount of depreciation you can claim depends on numerous factors (your property’s age, construction cost, whether it’s residential or commercial, etc), but the savings can be significant.
Every day, Washington Brown empowers investors by discovering thousands in permissible deductions. For example:
- Brand New Apartment/Townhouse (value $650,000) – $12000 to $15000 in year one deductions.
- Older Residential Property (value $400,000 unit built post-1987) – from $3000 to $5000+ in year one, mainly capital works and new plant and equipment.
- Renovated Investment Property – significant deductions can come from recent renovations, even on older properties (renovated after 1987).
- Commercial Property – offices, warehouses, retail etc, although variable, claims can typically be three times higher than residential buildings.
Want to see your property’s potential up front? Washington Brown can provide a FREE, no-obligation estimate on your possible depreciation deductions before you commit!
Do All Properties Qualify for a Depreciation Schedule?
Many of our happy clients have been amazed to discover their property qualifies for a depreciation schedule, when for years they believed they were ineligible.
Here are the most common questions we are asked regarding property depreciation schedule entitlements:
If you have a building that brings in rent (or potentially could), whether it’s commercial or residential, you can typically claim with a depreciation schedule. This means it applies to a vast spectrum of properties, such as houses, retail outlets, apartments, and warehouses and factories.
If your residential property was erected after the 15th of September 1987, you can claim Capital Works Deductions (if you recall, that’s Division 43) on the building’s original construction. Any new structural changes are also eligible, whether your property was built before or after 1987.
The rules for commercial properties are slightly different to residential. For a commercial building to qualify, its construction must have begun on the 19th of July 1982 or later. Generally speaking, the deduction rate is set at 2.5 percent per year, although some specific buildings enjoy four percent (like hotels).
Yes! If you bought a new building, or installed qualifying improvements, you can use a depreciation schedule for deductions. Under Division 40 (plant and equipment), all new items that you install or acquire in your brand new rental property are depreciation-eligible.
Contrary to popular belief, you can claim on some old buildings! Admittedly, if it was built before 1987, you may not be eligible for capital works deductions on the original building’s structure. But, you may still be able to claim on:
- Capital works – for renovations, alterations, structural improvements, or extensions after the qualifying date, even if by previous owners,
- Plant and equipment – although you can’t claim on current second-hand assets on residential property (after May 2017), you can claim for new plant and equipment you buy after purchasing the property.
Sure! If you own an investment property, but haven’t claimed depreciation, it’s often not too late! Usually, you can amend previous tax returns (up to two years) to claim missed depreciation deductions. What’s more, your depreciation schedule can be amended if you undertake new renovations or make changes to the property.
While it must be an income-generating property to be eligible for depreciation, you can claim for the times when the building is vacant, as long as it is truly available for rent. For example, it should be widely advertised as for rent, have a reasonable rent rate, and not have absurd conditions that are off-putting for would-be tenants.
Why Do I Need a TDS? Can’t I Just Do It Myself?
If you don’t have a depreciation schedule, you’re most likely missing out on thousands of tax savings. And, if you try to do it yourself, whether off-the-cuff or with an online form, you will probably underclaim, miss tax deductions, and expose yourself to ATO compliance issues.
7 Reasons You Shouldn’t Complete Your Own Depreciation Schedule
#1 ATO Recognition
Under Tax Ruling TR 97/25, the ATO recognises that a quantity surveyor is the depreciation schedule expert. They have the required skills to estimate past and current construction costs.
#2 Complex Legislation
Depreciation law is seriously complex and frequently alters. For example, the dramatic changes to second-hand residential property rules for equipment after May 2017. Furthermore, depreciation calculations demand in-depth knowledge of tax law, building costs, and the effective lives of all different assets.
#3 Necessary Site Inspections
Some depreciation schedules need a thorough site inspection. A quantity surveyor prepared depreciation report involves professional room measurements, eligible asset identification, and an estimation of the original construction costs, if the actual figures are unavailable.
#4 Deduction Maximisation
Expert depreciation schedule specialists, such as Washington Brown, are trained to locate every depreciable asset. This includes non-obvious items that may be suitable for immediate write-offs. This boosts your deductions, particularly in the early years,
#5 Depreciation Methods
Unless you’re a depreciation specialist or accountant, it’s unlikely you have a grasp of diminishing value and prime cost systems. Washington Brown knows how they work, and can utilise the best process for your particular circumstances.
#6 Protection for Audits
Audits can happen, when the ATO performs an extensive examination of your records and processes. An expertly prepared depreciation schedule delivers reliable, trustworthy, and robust documentation. Furthermore, it shows the ATO that you’ve done everything in your power to accurately calculate your deductions.
#7 Time and Effort
Preparing, gathering information, investigating eligible assets, and creating an accurate depreciation schedule takes time and a lot of hard work. Washington Brown’s professionals complete these tasks every day of the week, meaning rapid turnarounds and removing the burden and worry from you.
Is a Tax Depreciation Schedule (TDS) Worth the Cost?
Undoubtedly. A tax depreciation schedule is a powerful tool that continually brings you returns that totally outweigh its initial cost.
When you consider that for an established residential property, the depreciation schedule cost is generally around $495 – $770, and a townhouse could bring up to $12,000 in depreciation deductions in the first year alone, it’s a no-brainer.
How an Investment Property Depreciation Schedule From Washington Brown Pays Off:
Possibly thousands in deductions – our clients typically claim thousands of dollars in depreciation deductions every year.
No-cash outlay required – unlike other expenses, you don’t spend money to save tax with depreciation, it’s just the wear and tear on your property and its assets.
Tax depreciation schedule costs are deductible – the invoice for preparing your report is an allowable deduction against revenue.
Latest tax regulation advice – our specialists are always on top of new or amended regulations, ensuring you claim everything to which you’re entitled.
Maximised claims – we check for every possible eligible deduction, including from capital works and older renovations, which a less thorough provider might miss.
ATO compliance – our reports are 100% compliant, giving you reassurance and no unexpected fines or penalties.
Fee promise – for properties built after 1987, we guarantee twice our fee in deductions inside the first 12 months, or the report is free!
Genuine Case Studies, Real Results
You don’t just have to take our word for it! At Washington Brown, we have an unmatched, proven track record of helping thousands of investors substantially boost their cash flow and reduce tax liabilities with specialist depreciation schedules.
Here are just three examples:
Case Study:
Interstate Purchase of an Older Property
Client: Lesley, Property Investor
Property: Older property built in 2005, purchased interstate.
Result: For her property, Lesley received a $10,000 first-year deduction.
“I chose Washington Brown to do my tax depreciation because I needed a nationwide company. I was really happy. I would recommend Washington Brown to other property investors. They are really efficient, and the whole process was seamless.”
-Lesley
Case Study:
2025 New Apartment Purchase
Client: Pradeep, Property Investor
Property: Purchase of a new apartment in 2025.
Result: $19,720 first year claim, $7,296 first year tax savings.
“I decided to work with Washington Brown…I’m so glad I did. I didn’t even need a property inspection, which not only saved me time but also reduced the cost of the depreciation schedule service. Thanks to their professional expertise, I was able to maximise my claims and improve my overall cash flow from a weekly loss into a small profit.“
-Pradeep
Case Study:
Office Building Purchase
Client: Paul, Property Investor
Property: 143 square metre office suite.
Result: $16,927 first year claim, $6,263 first year tax savings.
“To ensure I fully understood the tax depreciation implications on my cash flow, I reached out to Washington Brown for expert advice…From the outset, the team guided me with professionalism and clarity, easing my initial concerns. They provided clear insights into the tax deductions available, which helped me when making a decision.“
-Paul
How Is a TDS Prepared? Our Straightforward 3-Step Process
At Washington Brown, our ATO-compliant tax depreciation schedule process is designed to be as straightforward and worry-free as possible. Rapid and efficient, it ensures a quick turnaround, meaning there are no delays in claiming your tax savings. Here’s how it works:
Step 1 – Free Quote
It all starts with a free, no-obligation quote. Just complete our quick online quote tool, we’ll ask a few key questions, and deliver an immediate estimate of the deductions you can expect.
Step 2 – Property Assessment
When you agree to proceed, our property depreciation report specialists will gather the required details. This could include a physical inspection, or we may use plans and construction information.
Step 3 – Final ATO-Compliant Report
Including all your eligible deductions, your depreciation report will be completed with our signature fast-paced turnaround. You and your accountant will receive the document in an ATO-compliant format, ready to be used to boost your tax efficiencies.
Australia-Wide – Your Depreciation Specialists, Wherever You Invest
It doesn’t matter where your investment property is located. With our extensive Australia-wide coverage, Washington Brown can help!
Just contact your nearest state office.
We Save Thousands in Tax for Our Clients In:
Resources and Tools … Further Your Depreciation Schedule Knowledge
At Washington Brown, we’re committed to empowering Australian property investors with the understanding, knowledge, and tools to maximise their financial efficiencies. Our extensive resources, specifically designed to help you understand all aspects of property depreciation, include:
Blogs
Our blogs provide deep dives into specific depreciation questions, topics, insights, and legislation updates. Our most-read pages include:
Depreciation Calculator
Receive an instantaneous estimate of your possible depreciation deductions.
The Investor’s Guide to Depreciation
Keep Claiming It! Written by Washington Brown CEO Tyron Hyde, is your smart guide to property depreciation … like having an expert in your pocket. It breaks down the post-2017 rule changes and shows you how to maximise your investment returns.
Are You Ready to Unlock Thousands in Savings?
Every year, property investors like you continually battle against rising prices, ever more complex statutory obligations, and the challenge of securing ideal tenants. In this tough sector, you need an edge, not just so you survive, but instead, really thrive.
Depreciation schedules are the most underused legal tools to gain this advantage.
At Washington Brown, we’ve spent over four proud decades helping Australian investors maximise their returns with ATO-compliant, accountant-ready reports. We know every rule, every deadline, and every single detail, so you don’t miss a hard-earned dollar that you’re entitled to.
Start claiming what’s rightfully yours, speak to Washington Brown NOW.
Depreciation Schedules FAQs
Yes. While depreciation schedules allow you to claim deductions on both commercial and residential properties, there are differences. They include disparate asset classes, particular effective lives, Division 40 eligibility rules, and second-hand plant and equipment regulations.
As one of the most respected depreciation report companies, Washington Brown has specialists in both the home and business fields, allowing you to receive the maximum deduction entitlement.
A tax depreciation schedule, sometimes known as a TDS or a depreciation report, is a detailed document prepared by a quantity surveyor or depreciation specialist. It demonstrates the tax deductions you’re entitled to claim, based upon your investment property’s wear and tear.
The rules differ between residential and commercial properties.
For residential buildings, bought after the 9th of May 2017, you usually cannot claim depreciation on existing second-hand plant and equipment. Although, you may still be able to claim on new assets you buy and install. On commercial properties, second-hand plant and equipment is generally still eligible for claims.
With Washington Brown, it’s simple with our three-step process!
- Get a free estimate.
- We conduct an assessment/inspection.
- We prepare and deliver your ATO-compliant report! That’s it!
The great thing about depreciation schedules is that they can last for up to 40 years! Once it’s done, it’s done, making it extremely cost-effective. Typically, you only need your report updated if your property undergoes substantial extensions or renovations.
Yes, prime cost and diminishing value depreciation. At Washington Brown, we can utilise either system, using whatever is most beneficial and suitable for you and your accountant.
Don’t panic, but act swiftly! If you pick up an error in your depreciation schedule, it can be amended or updated, together with your tax return if required. Simply contact the professional who created it on your behalf. Reputable specialists, such as Washington Brown, will rectify the issue immediately.
Once the tax depreciation schedule is in your hands, hand it over to your trusted accountant. They will use the information to claim your eligible tax deductions and help you pay less tax.
A tax depreciation schedule is more than important for investors, it’s essential. It permits them to claim substantial non-cash deductions, boosting cash flow and lowering their tax liability.
While the perfect scenario is to get a depreciation schedule as soon as possible, if you’re a little late, it doesn’t matter too much! Typically, you can amend a past tax return for a period of up to two years. This means you can claim any missed allowable depreciation deductions.
At Washington Brown, we can assist in preparing retrospective reports to help you recover these missed opportunities.
Your depreciation schedule can be significantly affected by renovations. New capital works and plant and equipment that are associated with the alterations are usually depreciable, meaning they can reduce your tax liability.
It’s not a legal requirement for property investors to obtain a tax depreciation schedule, although it’s highly advisable. Without one prepared by a specialist such as Washington Brown, it’s virtually impossible to claim all your allowable deductions, meaning you’ll be paying more tax than you are required to do.
If you sell your investment property, the depreciation schedule ends. It remains very important, as any depreciation you’ve previously claimed could impact your CGT (Capital Gains Tax) calculations.