Question 1

What is tax depreciation?

Accepted Answer

Tax depreciation is a tax deduction that property investors can claim for the wear and tear of their investment property and its fixtures over time. This includes building structure (Division 43) and plant and equipment items (Division 40).

Question 2

Do I need a quantity surveyor for a depreciation schedule?

Accepted Answer

Yes, the ATO requires that depreciation schedules for investment properties be prepared by a qualified quantity surveyor. Koste's team includes AIQS-certified quantity surveyors who produce ATO-compliant reports.

Question 3

How much can I save with a depreciation schedule?

Accepted Answer

Property investors typically claim between $5,000 to $15,000 in depreciation deductions in the first year alone. The exact amount depends on the property age, type, and construction cost.

Question 4

Is it worth getting a depreciation schedule for an older property?

Accepted Answer

Yes, even properties built before 1985 can still claim depreciation on plant and equipment items like carpets, blinds, hot water systems, and appliances. Any renovations also create new depreciation opportunities.

Division 40: The Tax Savings That Never Get Clawed Back