Why You Need a Tax Depreciation Schedule for Your Investment Property

This schedule is a simple but powerful tool. It lets you claim depreciation allowances for the natural wear and tear of your income producing property and its plant and equipment assets.

Without one tax depreciation schedule, you could be leaving money on the table. With one, you gain access to fully tax deductible non-cash deductions that improve cash flow, reduce taxable income, and boost your maximum return on investment.

At Duo Tax, our team of qualified quantity surveyors prepares Australian Taxation Office (ATO) compliant depreciation reports to ensure you claim all the deductions available.

What is a Tax Depreciation Schedule?

A tax depreciation schedule is a comprehensive report that shows all the tax depreciation deductions you can claim for your investment property and its equipment assets. It is prepared by a qualified quantity surveyor, not your accountant or registered tax agent, as surveyors are recognised experts authorised to estimate construction costs and asset values for depreciation purposes.

The schedule covers two types of deductions:

Division 43 – Capital Works Deductions: Structural items such as walls, roofs, ceilings, and built-in cabinetry. Most residential investment properties built after 15 September 1987 qualify for these capital works deductions, which can last up to 40 years.

Division 40 – Plant and Equipment Depreciation: Fixtures and fittings such as carpets, blinds, air conditioning units, appliances, and hot water systems. Each has an “effective life” set by the Australian Taxation Office, which determines how quickly it can be depreciated using methods like prime cost or diminishing value method.

By combining both, a detailed report gives you a clear year-by-year guide to maximise deductions and claim all the depreciation allowances you are entitled to.

Why Every Investor Needs A Tax Depreciation Schedule

A tax depreciation schedule is more than just a document. It can transform how your residential property investment performs financially.

Claim depreciation claim deductions – Depreciation is a non-cash deduction. You do not need to spend extra money to claim it. The deductions come from the natural decline in value of your property and its assets.

Improve cash flow – By lowering taxable income, a schedule lets you keep more of your rental income. For many residential property investors, depreciation is the second-largest deduction after loan interest and landlord insurance, making a big impact on yearly tax deductions and cash return.

Maximise long-term tax benefits – A schedule can provide up to 40 years of depreciation allowances, giving you benefits for the effective life of the property. Even older properties, or those with renovations completed by a previous owner, may still qualify for claims.

Avoid missed depreciation deductions – Without a schedule, you risk losing thousands in unclaimed deductions. The longer you wait, the more tax you pay.

At Duo Tax, we make sure you capture all the deductions available and maximise your tax benefits.

How a Tax Depreciation Schedule Works

A tax depreciation schedule is simple to use but must be prepared by a qualified quantity surveyor. The process involves four key steps:

1. Property Qualification – The first step is qualifying your property by gathering the necessary details to confirm there is potential value in a depreciation report. This includes reviewing factors such as the property’s age, type, and construction.

2. Calculation of deductions – Each item is valued and given an effective life under ATO rules. Deductions are calculated using either the prime cost method (spread evenly) or the diminishing value method (higher claims in early years).

3. Preparation of the report – An ATO-compliant schedule is created, often covering up to 40 years. It may include instant asset write-off details, low-value pools, and pro rata adjustments for part-year ownership.

4. Using the schedule – Your accountant applies the figures to your tax return each year. The same report can be used annually unless major renovations require an update.

At Duo Tax, we streamline every step to deliver accurate, compliant schedules that maximise your deductions with minimal effort from you.

Common Property Investor Questions

Is a depreciation schedule worth it?

Yes. In most cases, the tax savings outweigh the one-off cost. Many investors recover the fee within the first financial year.

How much does it cost?

It depends on your property type and size. The fee is also 100 per cent fully tax deductible.

Do I need one for an older property?

Yes. Even older properties may qualify, especially if renovations have been completed by you or a previous owner.

Can I amend past tax returns?

Yes. If you missed depreciation deductions, you can usually amend financial year tax returns for up to two years to claim missed depreciation deductions retroactively.

At Duo Tax, we review each property to make sure no depreciation claim is missed.

Why Choose Duo Tax For Depreciation Schedules

The right partner makes all the difference when it comes to tax depreciation. At Duo Tax, we focus on maximising your maximum deductions while keeping the process simple and stress free.

Here’s what sets us apart:

• Qualified experts: Our surveyors are TPB registered, members of the Australian Institute of Quantity Surveyors, and highly experienced in preparing tax depreciation schedules.

• Proven results: We have helped thousands of residential property investors save thousands of dollars through accurate, detailed, and fully compliant tax depreciation reports.

• Nationwide service: Whether your property is in a capital city or a regional area, we can assist you anywhere in Australia.

• Simple process: From initial engagement to final report, our approach is fast, clear, and transparent.

• Great value: The cost is entirely tax-deductible and often pays for itself many times over.

A tax depreciation schedule is one of the smartest tools for property investors. It improves cash flow, reduces taxable income, and boosts long-term tax benefits. Without one, you risk missing valuable tax depreciation deductions each financial year.

With Duo Tax, you gain a trusted partner who ensures every dollar of depreciation claim is maximised.

Contact Duo Tax today for an obligation-free quote and discover how much you could save with a tailored investment property depreciation schedule.

Tags:

• Discover

Share