Tax Depreciation

Understanding Labor's Negative Gearing Policy

Understanding Labor's Negative Gearing Policy

Last week we hosted an event to discuss the proposed Negative Gearing changes and how they will affect the Perth property market if Labor win next month.

We heard directly from Madeleine King MP on the reasons why Labor is pushing for the changes, while David Cresp (Property Economist from Urbis) provided an update on the current Perth market and an assessment of the effects these changes may have here. 

Tax Depreciation - Doesn't my accountant look after that?

Tax Depreciation - Doesn't my accountant look after that?

It’s a common misconception that Accountants provide Tax Depreciation Schedules for Investment Property owners. Unfortunately this is not true, they may help arrange for a Schedule to be done, but they cannot do it themselves.

Tax Depreciation firms (Quantity Surveyors) work very closely with Accountants and other financial professionals to help investors make the most of the tax benefits associated with owning investment properties. However, Accountants cannot legally produce the Schedule required by the Australian Taxation Office, in particular the construction costs (otherwise known as Div.43 Capital Works).

Changes to Tax Depreciation Laws

Changes to Tax Depreciation Laws

Today the Australian parliament passed the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017.

These changes mean that those who purchased second-hand residential properties after 7:30pm on the 9th of May, 2017 will not be able to claim tax depreciation on the existing Plant and Equipment – for example blinds, carpets, and air conditioning. This is to prevent ‘double-dipping’ by successive owners of the property claiming depreciation on the same pieces of Plant and Equipment. The new owner will still be able to claim depreciation on any new pieces of plant and equipment that they purchase themselves.

Budget Update

Budget Update

The proposed changes announced last week in the Federal Budget effecting Negative Gearing are designed to restrict the tax deductions available when an investor buys an established residential property. Anyone who buys an established property for investment purposes after 7.30pm on the 9th of May 2017 will no longer be able to claim depreciation on the Plant & Equipment – Division 40 (fixtures & fittings) that comes with the property, including in strata common areas. It is designed to prevent ‘double-dipping’ by all successive owners of the property claiming depreciation on the same pieces of plant & equipment.