Tax depreciation is a great way to claim tax deduction on your buildings and plant and equipment, saving you thousands each year.
Asset Economics provides Australian tax depreciation services
For years Asset Economics has been a market leader in Australian tax depreciation services industry, and has developed into one of the most trusted voices to turn to. Our exceptional team of quantity surveyors and tax depreciation experts has the skill and experience to handle jobs of any size, and is led by a strong and passionate leader who knows the industry inside and out. The team at Asset Economics understands what it takes to make a successful project, and we take pride in boosting the performance of our clients investment properties through our unparalleled experience.
1. What is tax depreciation?
Tax depreciation refers to the process of claiming deductions on income tax for the decline in value of an income-producing property over time. This includes buildings, plant and equipment that are used in the production of assessable income.
In Australia, tax depreciation is calculated on a property’s effective life, which is determined by the Australian Taxation Office (ATO). The effective life is the period over which an asset is expected to be used by any entity to produce income. Depreciation is calculated as a percentage of the asset’s cost and is claimed as a deduction against the income earned from the property.
Investors and property owners can claim tax depreciation on their income-producing properties including residential, commercial or industrial properties. The depreciation can be claimed on the building itself and also on the plant and equipment such as appliances, carpets, blinds, and other items that have an effective life.
Asset Economics specialists can prepare a schedule for a property, which is a detailed report that outlines the amount of depreciation that can be claimed on the property over the years. This can be used to claim deductions on the investor’s income tax return, which can result in significant tax savings over the life of the property.
2. Who is eligible for tax depreciation ?
Property investors: Individuals or entities who own investment properties, such as residential, commercial or industrial properties.
Property developers: Developers who construct new properties or carry out significant renovations on existing properties can claim tax depreciation on the building and on plant and equipment used in the construction.
Small business owners: Small business owners who operate a business from a leased property can claim tax depreciation on the portion of the building used for the business and on any plant and equipment used in the business.
Self-Managed Super Funds (SMSF): SMSF trustees who hold income-producing properties in their fund can claim tax depreciation on the assets of the fund.
3. What is investment property depreciation?
Investment property depreciation refers to the process of claiming deductions on income tax for the decline in value of an income-producing property over time. This includes both the building and the plant and equipment assets that are used in the production of assessable income.
Investment property depreciation can be claimed by individuals or entities who own an income-producing property, such as residential, commercial or industrial properties. The depreciation can be claimed on the building itself, and also on the plant and equipment such as appliances, carpets, blinds, and other items that have an effective life.