A New Granny Flat Built By Owner for $130,000
The Numbers: Charlotte’s Granny Flat Property
Type of Purchase
Because Charlotte built a brand new granny flat, she 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 Charlotte’s cash position with and without depreciation in her first year of owning the property.
According to her Duo Tax depreciation schedule, Charlotte could claim $7,300 in depreciation in her first year.
Charlotte’s numbers without a depreciation claim
Charlotte’s numbers with a depreciation claim of $7,300
Without depreciation, Charlotte was only generating $84 of profit from her newly built granny flat. However, by taking advantage of the Australian Tax Office’s tax breaks and making a depreciation claim, she started generating $144 each week – which is $60 more than before her depreciation claim.
This means that Duo Tax saved Charlotte a total of $3,151 in her first year after building her granny flat.
The great thing about her depreciation schedule is that it’s valid for up to 40 years! So, Charlotte can continue saving money each year as long as she 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.