depreciation question

Hiya

A pretty good description is available here http://www.bmtqs.com.au/tax-depreciation-schedule

Cheers

Jamie

Ok, unless you misunderstood your accountant – sack your accountant and get one that knows something about property tax.

Ask how many properties an accountant has- it's a good start.

I changed accountants when I asked my previous one whether I should get depreciation reports for my properties. His answer was "up to you". When I changed accountants my new one backdated the depreciation reports, saving me thousands of dollars. When my old accountant asked why I was moving I told him. He actually had a few properties himself so surprising answer considering. I guess you don't know what you don't know. That's where these forums are fantastic. I have gained a wealth of knowledge and saved myself money and mistakes by learning from others successes and mistakes.

Thank you to everyone that takes the time to answer questions and contribute knowledge.

Agreed – it surprises me how many investors don't both with a depreciation schedule – or think that their property is too old to be worth it.

Cheers

Jamie

Cool H i think you have misunderstood your Accountant.

Depreciation is a non cash deduction and certainly won't push you into the next Tax Bracket

Capital Allowance is the same although unlike Depreciation if you claim it now you reduce the Cost Base of the property by the same amount if and when you come to sell it

I.e Assume you claim $20K in capital allowance claims and you paid $320K for the property your CGT will be based on a Cost Base of $300K (This of course is a simplistic view and ignores Stamp duty and any other expenses you have not already claimed). 

Cheers

Yours in Finance

You need to consider the long term cost – depreciating your building will reduce its cost base and increase capital gains tax if you sell at a later date

Hi Harry,

Depreciation is an amount by which you are permitted to reduce your taxable income. Let’s say your salary is $80k and you have a $10k depreciation deduction. You do not get the whole $10k back from the taxman. Instead, your taxable income becomes $70k. Make sense?

If your salary was annoyingly just inside a particular bracket, and you had a $10k depreciation deduction, it might conveniently put your into the next taxable income bracket below (so that the tax you do pay is at a lesser %).

Hi Jade,

  I haven't ordered one in a few years now, but I recall $500 being about "the norm" back then (about 7 years ago).  A quick Google held a (possibly) pleasant surprise though – Google corpred.     Or maybe someone else on here already knows of them…..  

  I must admit my initial reaction was to think "Why are their reports so cheap?"   But their website provided the answer……  

Benny

That's about normal now. 700 plus gst.

if you have several houses you can lump them in all at once for a better deal. 

It pays itself back 4 fold in the first tax payment with a schedule of 3500-4000.

sounds like a excellent deal to me. 

Also you get discounts if you give them a lot of business. 2 years ago I used to get charged 660 and now I'm down to 550.inc gst