All Topics / Legal & Accounting / Depreciation, write off completely, or a bit of both

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  • Profile photo of StoreybuilderStoreybuilder
    Participant
    @storeybuilder
    Join Date: 2016
    Post Count: 45

    Hello Investors!

    I’m currently using a depreciation schedule on a property of mine. If I were to renovate a part of it, say the lounge room. Would I be able to put the full amount as a cost? Or would I basically need to get a quantity surveyor afterwards as it would affect the previous deprecation and be too intertwined?

    Thanks.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    If you renovate you will have receipts so the cost of items can be added to your schedule. If you dispose of items you may be able to scrap them and write off any remaining depreciation claims not otherwise claimed – many depreciation companies will amend your report for no charge in situations like this.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of StoreybuilderStoreybuilder
    Participant
    @storeybuilder
    Join Date: 2016
    Post Count: 45

    Thanks Terry that’s great to know.

    Profile photo of lisabellanlisabellan
    Participant
    @lisabellan
    Join Date: 2004
    Post Count: 48

    Interesting question, now if you sold in a couple of years could you then claim the amount outstanding/remaining on the depreciation schedule in full, to reduce any capital gains or is it lost?
    Thanks

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,190

    No you can’t claim depreciation when sold. In fact you will probably have to add back any depreciation claimed (reduce the cost base by the DIV43 claims that you made or could have made = building depreciation).

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

Viewing 5 posts - 1 through 5 (of 5 total)

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