Trusted quantity surveyors claim that
one of the best strategies to increase your investment property’s bottom line
is through depreciation. However, how much do you know about claiming
depreciation on your property, and how effectively can you apply it to serve
your benefit? If you’re only aware of the basics, provided here are some proven
effective tips on how you can benefit fully from claiming tax depreciation.
Say, you’re still in the process of purchasing
a property, and the sellers claim that all the work they had put into it
justifies their asking price. That seems fair, but you can negotiate better — get
significant reduction in the price if you probe into the past and current
market conditions which can help you determine the original construction cost and
how big its difference is from the present purchase price. By securing this
important data, you can pay less stamp duty and increase your chance of capital
gain from your property investment.
Another valuable tip to know is that
the higher the building structure, the higher the property depreciation as well;
this is because taller buildings make use of bigger plant and equipment
allowances. Plant and equipment allude to required services within the building
such as lifts, and all the items within the property such as ovens,
dishwashers, blinds, etc. Therefore, if you’re constructing or making
improvements and you want higher depreciation for the property, this can be the
basis of your strategy for securing deductions; you can claim the cost of all the
integrated features (plant and equipment) against your taxable income.
Third is, the little things count;
furniture can increase depreciation deductions and attract higher deduction
rates. A good example provided by quantity surveyors is how a $20,000 furniture
set supplied by developers can actually result in an additional $10,000
deduction during the first year, and this will still balloon to a higher value
as years roll in.
The last tip is hiring professionals
to prepare property depreciation schedules for this will allow you to fully
take advantage of the deductions (which have cut-off dates) that you are
entitled to claim. Quantity surveyors are the only people acknowledged by the
law as suitable professionals for the job; they are meticulous with the process
and they know the standards of insuring a comprehensive and professional report
that meets the ATO’s requirements, so you, the property owner, can secure the
chance of getting a higher deduction.
Do you have have any questions or suggestions? Write in comment section.
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