Just wondering i don't go to an accountant or anything but when i go to get my tax done i bought my first two IP in this current financial year. So one property was my PPOR until the tenants moved in on the 1/12 do i have to go to the bank and ask what interest was accured from the 1/12 to the 30/6/2010 same with the water bill's, strata etc. Sorry to be a pain i was considering doing it my self until i saw all this stuff relating to depreciation etc. Any help would be greatly appreciated.
tony
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
Sorry just re read it just to clarify my rushed topic. Do i need to get a bank statement showing the interest from the date the tenants moved in and show the tax man?
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
No you can pro rata the interest you will need the total yearly interest charged amount it may be on your internet banking after june 30 depends on bank you might have to ask for it if it is not on June bank statement.
1/12/2009 to 30/06/2010 work out the number of days
so 31 days has december so 30 days
31 days has january so 31 days
27 days has February so 27 days
31 days has March so 31 days
30 days has April 30 days
31 days has May 31 days
30 days has June 30 days
total 210 days.
now you take 210 divide it by 365 and multiply it by total interest charged for the year
you also need to do the same for expenses incurred like Council Rates, Water Rates, insurance, as these are part claimable.
See
http://www.ato.gov.au/download.asp?file=/content/downloads/IND00191817n17290609.pdf
example 5 document page 7 or page 11 of page 44 if going by adobe reader referencingDepreciation is not easy to work out as you need to work out effective life of items and if you are not quite up for the challenge you could employ a quantity surveyor who will issue you with a depreciation schedule that makes depreciation a lot easier to work out for the tax return form.
If it is building writeoff it is 2.5% of the cost of building the building p/a for 40 years.
but depreciation of building is subtracted off the cost base of the building .
which increases capital gain tax .
Also keep a copy of rates notice to work out value of your property for capital gains tax reasons.Hi Duckster,
I have a couple of questions on depreciation and CGT (please excuste the ignorance). I have read many time that claiming depreciation will shift the cost base of a property. Does that backdate to the time you have been claiming depreciation eg. up to 40 years. Or is there a time limit on how much the cost base shifts eg. 5 years? What about CGT?
I assume you would be in front claiming depreciation then getting charged extra CGT as it is calculated on 50% of the value?
Many thanks and I hope my questions make sense,
Andrew
itsandrew
Go as far as you can see and you will see further.
Duckster you are a legend thanks mate
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email MeNSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
duckster wrote:Depreciation is not easy to work out as you need to work out effective life of items and if you are not quite up for the challenge you could employ a quantity surveyor who will issue you with a depreciation schedule that makes depreciation a lot easier to work out for the tax return form.Couldn't agree more – here's some more info on depreciation reports: http://blog.rentwise.com.au/index.php/2010/05/18/depreciation-reports-please-explain
And if you're looking for a new accountant, here's what to look for: http://blog.rentwise.com.au/index.php/2010/06/20/what-to-look-for-in-an-accountant
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