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Maximise property depreciation this tax return

Maximise property depreciation this tax return

30 June 2016 BMT Tax Depreciation

The Australian Taxation Office (ATO) allows property owners to claim depreciation on the structure of any income producing property as well as the fixtures and fittings within the property. Depreciation related to a building’s structure can be claimed using capital works deduction. Claiming property depreciation deductions can put thousands of dollars back in an investor’s pocket in just the first full financial year alone. 


As a non-cash deduction, depreciation is often missed. When completing this years’ tax return, property owners should ensure they are claiming all the deductions available from their investment property.


As a general rule, residential properties in which construction commenced after the 15th of September 1987 and commercial properties in which construction commenced after 20th July 1982 are eligible for capital works deductions. Depreciation on plant and equipment items contained within a building can also be claimed. Each plant and equipment item has an effective life set by the ATO. The depreciation deduction available on each item is calculated based upon its effective life. Examples of these assets include hot water systems, carpets, blinds and air conditioners.


Generally, newer properties with newer fixtures and more expensive construction costs will attract greater depreciation deductions simply because they have not depreciated in value as much as older properties. However, older properties still attract depreciation. It is always worth enquiring about the possible depreciation deductions available on a current or potential investment property.


To maximise the depreciation deductions on any income producing property, investors should engage a specialist Quantity Surveyor to complete a tax depreciation schedule.


The schedule will show deductions for the life of the property (forty years) and will ensure the property owner claims all of their depreciation entitlements. The fee for a tax depreciation schedule is 100 per cent tax deductible.


To request a quote or make an enquiry visit or alternatively contact one of BMT Tax Depreciation’s expert staff on 1300 728 726.


Article provided by BMT Tax Depreciation.

Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation. 
Please contact 1300 728 726 or visit for an Australia wide service.