A Brand New House Purchased for $666,000
The Numbers: Chris’ Investment Property
Type of Purchase
Rent
Expenses
Because Chris occupied his brand new property before renting it out, he can’t claim plant and equipment (Division 40 assets) deductions and can claim only deductions for the depreciation on the property capital works (Division 43) deductions.
Without Depreciation vs With Depreciation Services
The following cost breakdown shows Chris’ cash position with and without depreciation in his first year of owning the property.
According to his Duo Tax depreciation schedule, Chris could claim $7,800 depreciation in his second year.
Chris’s numbers without a depreciation claim
Chris’s numbers with a depreciation claim of $7,800
Without depreciation, Chris had to pay $94 out of his own pocket each week. However, by taking advantage of the Australian Tax Office’s tax breaks and making a depreciation claim, Chris reduced that amount to only $39.
This means that Duo Tax was able to save Chris a total of $2,886 in his second year of owning the investment property.
The great thing about his depreciation schedule is that it’s valid for up to 40 years! So, Chris can continue saving money each year, as long as he continues to own the property.
Here’s How Much You Could Be Claiming
However, if you’re still feeling unsure about committing to ordering a depreciation schedule, we have designed a tax depreciation calculator to help you estimate what you could potentially claim on tax depreciation.
This is an accounting tool designed to help estimate and calculate the declining value of capital works and plant and equipment assets and relies on accurate figures to present accurate estimations.
Obtain your tax depreciation schedule in 3 easy steps.
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