Maximising your Depreciable Deductions
Did you know that there are more than 6,000 depreciable plant and equipment assets recognised by the Australian Taxation Office (ATO), where investors can claim deductions?
While we cannot list all 6,000, we thought that it would assist our investors to highlight the most common items found where you can claim depreciable-deductions in addition to the everyday expenses such as cleaning, repairs, and management costs.
The ATO outlines two separate depreciation deduction categories for claims: plant and equipment and capital works.
Deductible plant and equipment items are those that can easily be removed from the property and are subject to wear and tear over a period, such as:
- Air conditioners or heating systems
- Carpet
- Garbage bins
- Window coverings
- Smoke detectors
- Hot water systems
Deductible capital works are those items that are permanently fixed to the property and are also subject to wear and tear of the building structure, such as:
- Built-in kitchen cupboards
- Doors, locks, and door handles
- Clotheslines
- Bricks, mortar, walls, flooring, and wiring
- Driveways
- Fences and retain walls
- Sinks, basins, baths, and toilet bowls.
When it comes to tax time, you need to make sure that you claim every expense and item within the property to maximise your refund.
If you feel that you have not claimed your deductible plant and equipment and capital works items, we strongly recommend that you speak with your accountant, financial advisor, or tax depreciation expert to obtain a depreciation schedule.
