What parts of my property can I claim?
If you own an investment property (new or old, large or small), two types of depreciation are available:
- Plant and Equipment depreciation – this covers assets associated with your investment property that have a finite lifetime and fall in value over time as a result of age and wear and tear. It includes fittings such as carpets, lighting, appliances (stove, fridge), furniture, security systems, air conditioning units and even garbage bins which are provided as part of the property.
- Capital Works depreciation – this covers aspects of the building, including constructions, extensions, alterations and improvements of a structural nature. It includes work undertaken such as extensions for a garage or patio, kitchen renovations, bathroom makeovers or the addition of a gazebo, carport, fence or sealed driveway.
Different items within a rental property have different rates of depreciation based on the effective life of the item and when the asset was acquired. The ATO determines this.
Capital works depreciation is a particularly complex area and is not as easy as simply claiming a capital works deduction. Depreciation rates can vary depending on the type of building works and when construction commenced.
For more information about how to calculate our depreciation entitlements, see How to calculate depreciation.
Given the complexity of property depreciation, ordering a property depreciation report from an expert such as DEPPRO ensures correct asset rates are used and claims aren’t made on items that can’t be depreciated.
Qualified inspectors, like the professionals at DEPPRO, have the expertise and knowledge to know which items are depreciable, the rate at which they can be depreciated and how savings can be made.
As an ATO-compliant property depreciation company, DEPPRO keeps up-to-date with all ATO rulings and changes.
The ATO’s full list of depreciable assets (more than 200 items) can be found at www.ato.gov.au.