Second Hand Property · Koste Knowledge Base

Can I claim depreciation on a second-hand investment property?

Published 26 June 2026 · Last updated 26 June 2026

Quick Answer

Yes, second-hand investment properties may still have depreciation deductions, but the rules are different. Existing second-hand residential plant and equipment may be restricted, but eligible capital works, previous owner renovations, common property and new assets may still be claimable.

A common misconception is that second-hand properties have no depreciation.

That is not correct.

Second-hand properties may still have:

Division 43 capital works
Previous owner renovations
Extensions
Common property deductions
New assets added after purchase
Commercial plant and equipment
CGT cost base information
Excluded Division 40 values relevant for future capital loss review

The main restriction applies to previously used Division 40 plant and equipment in many residential properties acquired after 9 May 2017.

Examples of restricted existing assets may include:

Existing oven
Existing dishwasher
Existing carpet
Existing blinds
Existing air conditioning
Existing furniture

However, if the investor buys new assets after settlement, those assets may still be claimable.

Frequently Asked Questions

Can I claim existing appliances?

Annual depreciation may be restricted for second-hand residential assets.

Can I claim capital works?

Yes, where the building or improvements qualify.

Can previous owner renovations be claimed?

Capital works from previous owner renovations may be claimable.

Can I claim new assets I buy later?

Yes, new assets may be depreciable if used for income-producing purposes.

Should I still get a schedule?

Often yes, especially for capital works and CGT records.

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