Often investors are unaware of the significant benefits that come from claiming depreciation on their investment property. The Australian Taxation Office (ATO) allows property owners to claim depreciation deductions on the gradual wear and tear of structural items and for the plant and equipment assets contained within any income producing property.
Depreciation for income producing properties is claimable under two major components:
Capital works deduction (division 43) and plant and equipment (division 40)
Capital works deduction: Is the deduction available for the building structure and the items within it that are deemed irremovable. Plant and equipment assets: Includes assets which can be easily removed from the property. The asset’s condition, quality and effective life set by the ATO all determine the deductions available.
Sinks, basins, baths and toilet bowls
Hot water systems
Blinds and curtains
Carpet and flooring