Forum Replies Created
We’re currently planning a Kalgoorlie run (out of Perth). It will likely happen early May. We normally wait till we have around a dozen jobs there to spread the travel cost across them.
ScottTax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auYes, under the self assessment rules you can use your own reasonable estimate. I’m happy to talk you through this over the phone. On the ATO site you would find the list, but I think it’s about 1500 items long. Again, a quick conversation will save you having to find this list and wade through it.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auNo, I don’t think they can complain just because you block their view, though you’ll probably have to work out shadow lines. But they are likely to get pretty bitter and twisted, so everything about the application will be scrutinised. Most councils canvass people in properties immediately impacted upon by a development and get their feedback. This feedback is evaluated and the council makes a call. If there is no resolution, I guess you’re off to the Land and Environment Court.
The above is just based on my personal experience.
A neighbour next to one of my rental properties is doing a pretty big reno. He tracked me down a month ago and dropped around with the plans. I had a few objections and we talked through them to get a satisfactory resolution. If he’d just submitted the plans to council without telling me I would have been annoyed and probably less open to negotiation.
If you’re going to live in the place, you want to get on with your neighbours. Even if you’re not living there, the last thing you want is a mad neighbour during a contruction project.Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auTake Marc’s advice about not doing the job yourself. I did it once 15 years ago and saved bugger-all. It took me ages, too – especially the edges. The finished floor looked okay, but I could definitely see where the machine got the better of me – that big belt sander takes some wrangling. A mate of mine was doing the floors in his family holiday house some years ago. If anyone shouldn’t do any DIY jobs it’s him. He had no idea how powerful those sanders were. Maybe they’re easier to use these days? He put the coarse paper on it, went to the far corner of the room, started the thing up, lowered it onto the floor, and away it went. It took off across the room, through the fibro wall and into the side of his car parked just outside. I saw the photos (taken for insurance purposes), but I really wish I’d been there. I also wish I’d read what he put on his car insurance claim form.
ScottTax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auIt depends on what you actually own. Big complexes with golf course, roads etc are tricky. Although your unit might be situated within a golf course etc and you may have certain rights to use it, you may not actually own it. You may not own much beyond your building. In some cases things like a golf course may be owned by a seperate entity. This shouldn’t affect your access to it or anything like that, but it may affect your entitlement to claim depreciation on it.
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auHi Frankic,
You’re unlikely to find anyone in Mt Isa who can put together an ATO compliant schedule. If there was anyone there, I would contract them. We go there occasionally.
Your property is not eligible for depreciation on the original building cost – too old. But if the kitchen was put in after Feb 1992, the cost can be depreciated. If the kitchen reno – plumbing, power, cupboards, benchtops, tiling etc – cost $10K, you’ll be able to claim this at 2.5%pa i.e. $250.
In addition to this, there will be depreciation in the appliances (stove, air con), floor coverings and window furnishings. It’s unlikely there will be much else.
The viability of commissioning a schedule will depend on the quality of these things. I don’t suppose you have some photos you could e-mail me so I can have a look at them?Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auSo yours were only $20 Anibus? I think I will challenge it.
No Mini, they aren’t the ‘rates’. They’re much more than that. From memory, in Tassie the council and water rates are rolled into one.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auI think that request for an income tax variation is now called a ‘1515’ i.e. fifteen fifteen.
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auHi Breakfree,
Sorry, I saw that other post and forgot to reply to it.
As stated, depreciation claimed on the fixtures and fittings – hot water heater, appliances etc – don’t come into it.
A person on that other forum had something to say about this. I think he/she is an accountant and their name is MRY. They wrote something about it being important to have written-down values of assets in the contact of sale. I can’t for the life of me remember the exact point he was making.
I’ll see if I can find it again.
ScottTax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auMake sure you mention to the boys on the phone that you came via the PI forum – you’ll get a discount. I think one of our guys is heading west soon (Parkes area) to do a job.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auDepends on the region – some are tough.
We cover much of the coast and some inland centres at a standard price. We regularly travel to other areas. There is a travel fee for some places, but if we get sufficient jobs we spread it across them or sometimes absorb it ourselves.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auHey Mini, there was no criticism in that post.
I was writing in support of buyers agents (especially you) from the perspective of both buyers and sellers.
As a buyer, I would much prefer to buy after you had put a seller through the hoops.
As a seller, I have to provide more information, but things happen more quickly and there are fewer costs.
Like I said in the post, I’ll use a buyers agent again and that will be you.
I reckon anybody looking for cf+ deals these days needs to be in touch with a buyers agent (as well as doing their own searching) because lots of properties don’t make it into the hands of traditional agents or onto places like realestate.com
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auSpeaking from the other side, I’ve sold through a buyers agent (and will do so again in the next few months).
A good buyers agent will really put a vendor through the hoops to make sure their clients are getting value for money. Minimogul does exhaustive research on a property, including ‘crunching the numbers’ before she sends it out to her date base. If a deal doesn’t stack up from a cf+ perspective, I think she’ll state that. I bet Hunter House Hunters operates similarly.
I found it much tougher to sell through a buyers agent than a real estate agent, but from a sellers perspective I didn’t pay advertising costs or commission – the buyer pays the agent. I’m not sure whether they pay $2,500 annually + $6,000 for a deal, though.
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auGee, that’s an opening for some self promotion if ever I saw one.
We’re a little different from the average QS company.
The problem with the QS industry as a whole is that QSs have traditionally dealt with architects, builders, engineers, financiers, planners etc. Many of them aren’t very good at dealing with ‘mums and dads’.
It’s only been in the last 5 years that private investors have really cottoned onto depreciation and the QS industry hasn’t made the attitude shift.
Also, for the average QS, depreciation work is a small part of their turnover, so some don’t really put adequate resources into it.
We only do depreciation work and we’re by far the largest group in the country specialising in depreciation work.
We don’t use a ‘generic cost’ for assets. We will assess the value of an asset based on what we see. So a Miele stove has a different value from a Smeg, or a St George, or an Ilve or a Gagenau etc etc.
In our reports you will find an opening written-down estimated value for every single asset, so you can check them. You need to bear in mind, it is an estimate.
Let’s say you buy a 4 year old townhouse. We need to estimate the value of that oven as of the date you start to rent out the property.
Co-incidently, we had a client yesterday query the estimate we put on a dishwasher. We had estimated its value on the first available to let date at $800. The client had a receipt dated 4 months prior to this for $1,090. (She paid too much). We love receipts – actual costs are always preferred (by us and the ATO) to estimates. She faxed the receipt to us for our records and her report was amended and re-sent in 4 minutes.
Easy.
We can only do this because we have structured our business solely to deal with individual investors.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auI’ve spoken at one of the Reno Kings seminars and seen how they run them. There are group sessions and exercises, real life problem solving etc. They are a high energy, high involvement seminar. I’m not sure whether those guys have a book, but if they do I can’t see how they could replicate everything they cover in a seminar. I think a good seminar allows ample time for questions from the floor, too. You won’t get that opportunity from a book.
But of course, there are lousy seminars too where the presenter is just paraphrasing their own book.
I’d say the ones to be wary of are those where the presenter has just released a book and is riding the publicity wave. They’re the ones where the seminar tends to be the book.
ScottTax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auJohn,
In answer to your questions:
1) None.
2) Nope.
If you purchase a property and elect to do work to it before renting it out, you cannot claim the cost of that work.
It is not a ‘repair’ because you have not been renting the property out. If a property is damaged while you have been renting it out, then it becomes a repair.
It is also not allowable as a capital works deduction. Putting it simply, the ATO regard work done prior to renting out a property as a ‘cost of aquisition’. The value of that work is added to the cost of the property when you calculate your capital gain upon sale.
As I said earlier, do the minimum required to get a tenant in there for 6 months or so, even at a reduced rent.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auTake Simon’s advice re: getting a quote for the repair.
A repair like that can be tricky, too. If you are contemplating getting the vendor to repair it, you would need to stipulate how the repair is done i.e. if they just buy a can of that ‘shower seal’ product sold at hardware stores and slap it on, the problem will come back.
Ask the building inspector also whether there is any damage to the sub floor. If water has travelled laterally into the next room, it may have travelled down as well.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auIf you’re planning to do the renovations after settlement and before renting the place out, you won’t be able to claim the cost at all.
Wait till the property has been earning some income before you do anything. Right now, do the minimum required to get a tenant in there.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auIt gets better….
Only depreciation claimed on the building itself is deducted from the cost base. And in many cases this is less than that claimed on the Fixtures and Fittings, especially in the first 3-4 years.
The other thing to consider is that any property purchased after May 13, 1997 must have the eligible building depreciation deducted from the cost base upon sale whether it has been claimed or not during ownership. So if you don’t claim it, you’ll be slugged for it anyway.
Regards,
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.auI assume you’ve spoken to an accountant about shuffling the debt?
Regarding the expenditure, you can really only claim it as an expense if the cost has been incurred while you have been renting the property out.
Do only what is absolutely necessary now – wash those walls instead of painting them – and wait till you have at least 6 months of rent under your belt before you do anything else.
Scott
Tax Depreciation Schedules
Australia wide service
1300 660033
[email protected]
http://www.depreciator.com.au
