Commercial Property · Koste Knowledge Base

Can I claim depreciation on an office fit-out?

Published 25 June 2026 · Last updated 26 June 2026

Quick Answer

Yes, office fit-outs can often attract depreciation deductions if the fit-out is used for income-producing or business purposes. The claim depends on who paid for the fit-out, who owns the assets, and whether items are treated as plant and equipment or capital works.

Office fit-outs often contain a mix of depreciating assets and capital works.

Typical office fit-out items include:

Workstations
Loose furniture
Built-in joinery
Partitions
Carpet tiles
Vinyl or other floor finishes
Blinds
Lighting
Electrical works
Data cabling
Security systems
Air conditioning works
Kitchen appliances
Meeting room equipment
Signage
Reception counters
Storage units

The important question is ownership.

A landlord may own the base building. A tenant may pay for the fit-out. Sometimes a landlord contributes through a lease incentive. Sometimes both parties pay for different parts of the works.

A depreciation schedule helps separate:

Tenant-owned plant and equipment
Landlord-owned assets
Leasehold improvements
Division 40 assets
Division 43 capital works
Items that may be claimed over shorter or longer periods
Assets that may be scrapped or abandoned later

Without a proper breakdown, a business owner or accountant may treat the entire fit-out as one broad cost. This can lead to missed deductions or incorrect treatment.

Koste.ai can help business owners and accountants identify the key information required before a formal office fit-out depreciation report is prepared.

Frequently Asked Questions

Can a tenant claim depreciation on fit-out they paid for?

Yes. A tenant who pays for and owns the fit-out assets may be able to depreciate them over their effective life, depending on ownership and use.

What happens to fit-out deductions when a lease ends?

Assets that are abandoned or removed at the end of a lease may be eligible for a scrapping deduction if there is remaining written-down tax value.

Does a lease incentive affect the depreciation claim?

Yes. If a landlord contributes to the fit-out through a lease incentive, the ownership and cost attribution of assets needs to be reviewed carefully.

Do I need a quantity surveyor for a fit-out depreciation report?

A quantity surveyor can prepare a cost breakdown for depreciation purposes if the original builder invoices do not provide sufficient asset-level detail.

Is a fit-out depreciation claim different for a landlord versus a tenant?

Yes. Landlords claim deductions on assets they own, while tenants claim deductions on assets they funded and control. A depreciation schedule should clearly separate the two.

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Written by Koste Team · Koste Chartered Quantity Surveyors · AIQS Member · RICS Member · TPB Registered · 1300 669 400 · info@koste.ai