Professional tax depreciation organizations can spot several items in an investment property for which you will be eligible to claim valid depreciation benefits. Investment property owners can enhance their cash flow by claiming depreciation on investment property. You should not forget to claim a tax deduction on several household items as it will reduce your tax liability. You will be stunned to find out that even your garden gnomes are allowed to be depreciated for tax purposes. Several investors living in Australia end up underestimating the figure of items that can be depreciated for tax purposes.
Here are some vital details that you should not miss for boosting your property cash flow:
What is depreciation?
Depreciation can be defined as wear and tear of a property and its assets over a period of time. When you claim for depreciation, you are set to claim a tax deduction for loss in value of those assets as they age with time. Depreciation has emerged as one of the biggest tax deductions available for property investors every financial year. It also has the capacity to boost the rental property’s cash flow every year. You must claim for depreciation by using a tax depreciation schedule prepared with the help of a reliable quantity surveyor (QS).
Don’t forget to do your tax return
Depreciation can be claimed in the form of tax deduction in your tax return every year. You remain eligible to seek a claim for it in a similar manner as you claim for insurance, repairs & maintenance, property management fees, etc. The major difference from the other claimable expenditures is that depreciation has turned out to be a planned and calculated deduction. It implies that how much you will be able to claim for depreciation will be calculated with the help of formula. The calculation will be based on your building’s construction cost (Division 43), asset values, and effective life of every asset in your property (Division 40).
What is the role of an expert Quantity Surveyor?
It is not a herculean task to claim for depreciation. You can hire the services of professional QS to prepare your rental property depreciation schedule. An expert QS will be entrusted with the task of calculating depreciation that you may claim yearly and report it in your depreciation schedule. A depreciation schedule can be explained as a one-off purchase highlighting specifics of all deductions going ahead for the rest of your property’s lifespan. You may provide your depreciation schedule to a reliable accountant when you do your taxes every year.
You can start claiming depreciation as it is a relatively simple procedure. You may get in touch with specialist QS from Deppro depreciation to arrange a tax depreciation schedule for your property. It is worth noting Quantity Surveyors have been recognized by ATO under tax legislation TR97/25. A Quantity Surveyor possesses the important skills required for estimating construction costs for depreciation purposes. You should also organize a site inspection of the property to grab measurements and take pictures’ record of any assets inside the property.