A Tax Depreciation blog by Tax Allowance Services.
Individual Australian property investors are potentially missing out on thousands of dollars in potential tax deductions each year by not claiming their full tax depreciation entitlements.
Many Australian property investors may not know that a tax depreciation report undertaken by a qualified Quantity Surveyor and Registered Tax Agent can identify hundreds of items in an investment property for which you can claim legitimate depreciation benefits. As we about to enter a new tax year, owners of investment properties in Australia can significantly boost their cash flow by claiming these tax deductions on a large number of various household items through depreciation benefits.
Some of the legal, yet often neglected deductions include: carpets; hot water system; cook tops, blinds and solar systems.
The tax benefits associated with negative gearing can be very significant achieving tax benefits obtained through depreciation up to 65% of the total purchase price of the property. In some cases these tax benefits can total $350,000 based on a purchase price of $550,000.
To qualify for these legitimate tax deductions, an investor must have a fully compliant tax depreciation company undertake an onsite inspection of the property and then compile a depreciation report based on this inspection. Estimates of tax depreciation benefits for an investment property made from an office desk will not be accepted by the ATO.
Depreciation is a complex area of taxation that requires a professional to undertake a depreciation report because of constant changes in rules.
The ATO is now taking a more aggressive approach to tax deductions made by residential investors and has asked a large number to provide more details about their claims relating to property investment.
Property investors should check that the individual undertaking their tax depreciation schedule is a qualified Quantity Surveyor and Registered Tax Agent such as Tax Allowance Services Perth which gives protection to consumers that their tax depreciation report complies and is completed in a professional manner.