Understanding Depreciation Schedules – Advice from a Sydney Accountant | |
When you’re investing in property in Sydney, understanding depreciation is essential for maximising tax deductions—and optimising your returns. A tax depreciation schedule is a professionally prepared report that details how various aspects of your investment property decline in value over time, unlocking significant annual tax savings Thrifty Tax Depreciation +10 Acumentis +10 YouTube +10 Duo Tax Quantity Surveyors +2 bmtqs.com.au +2 . What Is a Depreciation Schedule? Depreciation is a non-cash tax deduction that reflects wear and tear on a property and its assets. In Australia, two categories apply: Division 43 (Capital Works): Covers structural and fixed components—walls, flooring, cabinetry, roofing, and the like. Division 40 (Plant & Equipment): Covers removable or depreciable assets—such as carpets, blinds, appliances, and air‑conditioning units Thrifty Tax Depreciation +3 Acumentis +3 Duo Tax Quantity Surveyors +3 . With a well-prepared depreciation schedule, eligible deductions are forecast across the useful lifespan of the asset—typically up to 40 years Duo Tax Quantity Surveyors . Why You Need a Depreciation Schedule 1. Maximise Tax Savings A tailored depreciation report ensures all eligible deductions are captured. Many reports reveal savings of $10,000–$15,000 in the first full financial year alone Thrifty Tax Depreciation +4 Acumentis +4 Washington Brown +4 . 2. Improve Cash Flow Tax deductions reduce taxable income, leaving you with more cash retained. Better cash flow may even help you finance additional investments. 3. No Annual Fees Once prepared, the schedule lasts up to 40 years without the need for renewal—unless substantial renovations occur. Updates can then be made to reflect capital improvements Washington Brown +1 . 4. Fully Tax‑Deductible The fee charged for preparing the schedule can itself be claimed as a deduction—often in the same year that you obtain the report Duo Tax Quantity Surveyors bmtqs.com.au . Choosing a Qualified Quantity Surveyor Depreciation schedules must be prepared by a qualified quantity surveyor who is registered or affiliated with the Australian Institute of Quantity Surveyors (AIQS), and is ATO‑compliant. This ensures accuracy, compliance, and maximised claim potential Acumentis +2 Thrifty Tax Depreciation +2 . When selecting a provider, consider: Local experience in Sydney’s suburbs and property types Transparent and competitive pricing Fast turnaround (commonly 5–10 business days) Duo Tax Quantity Surveyors +2 Thrifty Tax Depreciation +2 Acumentis +1 How It Works with Byron Accounting At Byron Accounting, our Sydney-based tax specialists work closely with accredited quantity surveyors to deliver full depreciation schedules. We take care of: Coordinating property inspections or desktop surveys Analysing eligible assets under Division 43 and Division 40 Preparing a comprehensive ATO‑compliant report for your accountant Ensuring the schedule captures the maximum possible deductions promptly Final Thoughts A tax depreciation schedule is a strategic, one‑time investment that can pay dividends year after year. With meticulous preparation and professional expertise, Byron’s Sydney accountants ensure property owners leverage every eligible deduction—and enjoy a stronger return on investment. | |
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