SomWe would like you to consider the three possibilities below

  1. You own an Investment Property
  2. You pay too much tax
  3. You want to get some of that back

Please read on to find how we can help you with an idea to save some tax this financial year.

  1. Has your property been assessed for a Tax Depreciation Schedule?
  2. What do you risk by leaving it?
  3. Is now the time to spend money to improve your property?

These are some of the questions you should be asking yourself over June!

The answer to the first question is easy. The average depreciation claims on all the work we have completed after the first 12 months is $5,546 on all property types in all areas.

We guarantee that after the first full 12 months of our report we will have saved you more money than our fee. Better still, you have further 39 years still to run with our schedule (and no further charges).Plus the fee to complete the service can be claimed back at the end of the month.

To understand how depreciation works, Read More……

 

What do I risk by leaving it?  If you have owned the property for some time, under current ATO legislation the ATO allow us to back date the report, the financial year we are in and the previous two. So engaging us before June 30 we potentially can commence your depreciation claim from the 1st July 2014.

When the financial year ticks over, we could be limited how far we can back date this report. We can talk you through your personal scenario.

 

Is now the time to spend money on my investment?

Let’s look at spending money on your property investment prior to 30th June means?

Take your hot water service as an example. And assume it has been depreciating for 2 years, The value of it is $2,400. The ATO suggests it should last 12 years, which allows a depreciation claim of $200 each year.

 

Hot Water Service Value Claim
Year 1 $2400 $200
Year 2 $2200 $200
Year 3 $2000 $200
Total Claim  $600

 

Now let’s look at if we replace or upgrade the hot water service after these two years

 

Hot Water Service Value Claim
Year 1 $2400 $200
Year 2 $2200 $200
Scrapping Adjustment -$2000 $2000
New Hot Water Service $2400 Added to property
Year 3 $2400 $200
 Total   $2600

 

Notice the remaining value of the hot water service is scrapped when it gets replaced. It becomes an immediate deduction when it gets replaced and the new hot water service starts depreciating all over again!

Other items in your investment that have been assessed and attract depreciation behave the same.  To be able to scrap an item, it needs to be assessed prior to establish its value.

Spending money and upgrading your property now could keep your investment performing better and help reduce your taxable income.

These are some tips about reducing this year’s taxable income.

Please get in touch if you would like to chat about your situation.