A New House Purchased for $680,000
The Numbers: Luke’s Investment Property
Type of Purchase
Because Luke invested in a brand new property, he can claim deductions for the depreciation on the property’s plant and equipment (Division 40 assets) and the property’s capital works (Division 43) deductions.
Without Depreciation vs With Depreciation Services
The following cost breakdown shows Luke’s cash position with and without depreciation in his first year of owning the property.
According to his Duo Tax depreciation schedule, Luke could claim $16,300 depreciation in his first year.
Luke’s numbers without a depreciation claim
Luke’s numbers with a depreciation claim of $6,031
Without depreciation, Luke had to pay $90 out of his own pocket each week. However, by taking advantage of the Australian Tax Office’s tax breaks and making a depreciation claim, Luke went from covering the loss to actually generating $26 each week.
This means that Duo Tax was able to save Luke a total of $6,031 in his first year of owning the investment property.
The great thing about his depreciation schedule is that it’s valid for up to 40 years! So, Luke 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.