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Duo Tax: Free Rental Property Depreciation Calculator

Duo Tax has designed a tax depreciation calculator to help property investors estimate how much depreciation they could potentially claim on before committing to purchasing a tax depreciation schedule.
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Institute of Quantity Surveyors

What is a Tax Depreciation Schedule?

As a building gets older, its structure and plant and equipment fixtures are subject to general wear and tear. So, each year, the value of the building and assets within the building decreases and depreciates.

The Australian Taxation Office (ATO) allows property investors to claim the property depreciation as a tax deduction.

To calculate depreciation and determine the value of your investment property and plant and equipment, a qualified quantity surveyor must inspect your investment property and assign a value to each asset. A tax depreciation schedule is a comprehensive report that details the tax depreciation deductions you can claim on the value of these assets.

At Duo Tax, our quantity surveyors can conduct some preliminary research using real estate data to determine the type of building, when it was built, the purchase price and the estimated construction cost. This way, you can ensure that you’re satisfied with the result of the report before committing to purchasing a depreciation schedule.

You can also access tools such as our depreciation calculator to calculate depreciation and help estimate what you could potentially claim before purchasing a depreciation schedule.

Our Tax Depreciation Calculator

The Duo Tax depreciation calculator is an accounting tool designed to help estimate and calculate the declining value of capital works and plant and equipment and relies on accurate figures to present accurate estimations. You can calculate your estimates using the straight-line depreciation method (prime cost) or the declining balance depreciation method (diminishing value) .

Once you’re happy with the potential deduction estimates, you can get in touch with one of our Quantity Surveyors, who will conduct a property inspection to note all the depreciable items. Following the inspection, you should expect your tax depreciation schedule within two weeks.

A single schedule provides 40 years of claimable deductions (or the maximum entitled years), so you will only have to have your property inspected once. And the Quantity Surveyor fees are a property tax deduction.

Please note that this is only for indicative purposes and should not be used to claim on your tax return.

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Frequently Asked Questions

What do online depreciation calculators do?

The Rental Property Depreciation Calculator is designed to provide investors with first-year and second-year estimates of how much they can likely claim depreciation deductions on their residential or commercial investment property. This will give you a good gauge of whether purchasing a tax depreciation schedule is worthwhile.

Alternatively, you can contact us to get a free estimate of your depreciation amount and quote for your depreciation schedule.

How do I use the depreciation calculator to calculate my depreciation amount?

The calculator will calculate the depreciation estimate based on a series of data points from our comprehensive database and compare this with similar properties to give you an approximate depreciation value for your investment property.

The ATO prescribes two methods to calculate depreciation:

  • The prime cost method: under the prime cost method, also known as the straight-line depreciation, you calculate the decrease in value of an asset over its effective life at a fixed rate each year
  • The diminishing value methods: under the diminishing value method, also known as the declining balance depreciation method, you claim depreciation at a higher depreciation rate in the first few years of ownership of the property. As a result, the depreciation deduction value will decrease each year until the asset value runs out. You can also increase the claim on items valued below $1,000 using low-value pooling

The calculator uses both the diminishing value and prime cost method to give you an estimate of what you can claim on a depreciating asset, construction costs or capital allowance.

It’s important to understand that these are only estimates for your investment property’s capital works allowance and plant and equipment assets. So, the final claimable depreciation amount is subject to change.

What are plant and equipment assets?

The term “plant and equipment” refers to the fixtures and fittings that are found within investment properties and are generally easily detachable from the property. The ATO recognises more than 6,000 different assets that investors can claim tax deductions on.

Here are some items that are considered plant and equipment fixtures:
Residential
Oven, stovetop and rangehood
Air conditioning units
Smoke alarms
Downlights
Electric garage door and remotes
Commercial
Fire hydrant booster
Billi hot water unit
Door closers for door struts
Coffee machine
Warehouse cranes and hoists

Why is it useful to use this depreciation calculator?

Investors can use the depreciation calculator for both pre-purchase or post-purchase situations.

Many investors don’t realise that depreciation is a significant claimable deduction on tax until after they’ve purchased it.

However, as investors become savvier or more informed, they also use this as a way to estimate savings they can make before committing to buying a property.

Is the investment property depreciation calculator accurate?

The depreciation calculator should be used more as an indication as opposed to a final accurate figure.

However, we’ve strived to make this property tax depreciation calculator as accurate as possible according to the available data we have, based on the thousands of properties we’ve inspected.

We find that many investors use this for research purposes to find out the first year and second-year depreciation deductions and then contact us directly to get a more accurate estimate if they believe there are ample opportunities for tax depreciation claims.

Is there a cost to using the depreciation calculator?

Absolutely not. This online depreciation calculator is entirely free.

Can I use the estimated depreciation amount for my annual tax return?

Unfortunately, no, you can’t claim these figures as depreciation deductions.

According to the Australian Tax Office (ATO), your property must be surveyed and evaluated by a qualified quantity surveyor. While we try to keep the tax depreciation calculator as robust and comprehensive as possible, it does not replace a qualified quantity surveyor.

Is the investment property depreciation calculator accurate?

The depreciation calculator should be used more as an indication as opposed to a final accurate figure.

However, we’ve strived to make this property tax depreciation calculator as accurate as possible according to the available data we have, based on the thousands of properties we’ve inspected.

We find that many investors use this for research purposes to find out the first year and second-year depreciation deductions and then contact us directly to get a more accurate estimate if they believe there are ample opportunities for tax depreciation claims.

How can I find out the age of my property?

The depreciation calculator should be used more as an indication as opposed to a final accurate figure.

However, we’ve strived to make this property tax depreciation calculator as accurate as possible according to the available data we have, based on the thousands of properties we’ve inspected.

We find that many investors use this for research purposes to find out the first year and second-year depreciation deductions and then contact us directly to get a more accurate estimate if they believe there are ample opportunities for tax depreciation claims.

Does the calculator estimate partial year depreciation?

Not all properties are purchased at the start or end of the financial year to make for an easy depreciation estimate. This means that your first year estimates may be slightly different to a real tax depreciation schedule’s figures because you’ll only claim partial year depreciation instead of for a full year.

What about scrap value calculations?

Scrap value, otherwise known as residual value or salvage value, is calculated differently and would require our team to provide you with a free estimated amount on how much depreciation you could potentially claim before your renovation or knockdown of the property.

Can I order a depreciation schedule?

Yes, click below to order a tax depreciation schedule.
Order a tax depreciation schedule
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