Removal of Depreciation on Buildings for Tax Deductions
Posted
3/03/2011
From the 1 April 2011 financial year and onwards, there is no longer the ability to claim depreciation on buildings with an estimated useful life of 50 years or more. However chattels (for example stoves, carpets, dishwashers etc) are still able to be depreciated.
This rule change will predominantly affect rental property investors and will have the result of creating less loss or more profit which may result in more tax to pay or lower refund amounts. It would be wise to speak to your tax agent about the impact of this change. If you have been claiming depreciation on your buildings it may be advisable to start budgeting for this and perhaps saving money for tax if a profit will be the outcome.
Tax returns up to 31 March 2011 will not be affected, the first year to impact will be 31 March 2012.
If you've not been claiming depreciation on chattels it would be wise to identify and value the chattels for the the 31 March 2011 returns and start claiming these to achieve tax benefits now and in the future.
Related Items:
Depreciation |
Rental Property |
Tax Refunds |
Tax Returns
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