Tax Depreciation

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SPONSORED POST
Did you know statistics show that over 62 percent of property owner’s under-claim their property tax depreciation allowances and many don't even claim them at all!
Property Tax Depreciation is vital, it's a property investor's secret weapon for better cash flow and yet sadly it’s widely misunderstood. And this is why Napier &amp; Blakeley give you NBtax. 
NBtax, an online property tax depreciation service uses innovative technology to access Napier &amp; Blakeley's specialist property tax depreciation consultants. NBtax means investment property owners can start the process quickly and easily without the need to spend too much time going to and fro.
Once you submit the required information, our expert teams of Quantity Surveyors get on with tailoring your property tax depreciation schedule, setting you up for the depreciable life of your investment.
With decades of property tax depreciation experience, Napier &amp; Blakeley are ideally positioned to provide specialist services, helping investors maximise their depreciation claims while being ATO compliant.
Property tax depreciation is calculated on two different aspects of your asset, Depreciating Assets and Building Allowances. Depreciating Assets include plant and equipment, things like carpets, lifts, appliances and white goods. Building Allowances are primarily based on the building and structure of your asset.
We, Napier &amp; Blakeley, were the first in Australia to provide professional, specialised property tax depreciation advice, and now over 30 years later we’re still the market leaders. A professional property tax depreciation schedule can boost your cash flow potentially by tens of thousands of dollars over the life of your investment.
Yet so many property owners stumble. A simple lack of knowledge and the specialist nature of property tax depreciation means investors often under-claim and at times even avoid the process missing out on thousands. Unfortunately many investors rely on their financial advisors or generic advisors who really cannot dissect a property and its component parts and, they may not maximise the potential benefits.
Remember that no property is too old or small to benefit from a professionally prepared property tax deprecation schedule. Whether it be commercial, residential or industrial, brand new, renovated or just old, every investment property has the potential to further increase your cash-flow. There's hard cash sitting there waiting to be claimed. It's just a matter of taking the first step in the right direction, and that's where NBtax comes in.
Combining the latest in digital innovation with years of specialist experience, it's the best of both worlds, we make life easier for investors in a time poor world.
NBtax combines cloud-based data management with our specialist experience.  With an NBtax property depreciation schedule for your investment you’re able to relax and know that we’ve got your back. Our Quantity Surveyors are some of the most experienced in the industry and their objective is to produce a maximised property tax depreciation schedule tailored to your investment.
It's a wise move, an easy process. More cash and peace of mind – the best of both worlds with NBtax.
Contact one of our specialists for <a href="https://nbtax.com.au/" target="_blank">further information</a>.
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It’s tax time and NBtax is here to help

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The Sydney apartment market was now suffering serious falls in certain locations, according to The Australian columnist Robert Gottliebsen.
He said Sydney's building rate for apartments in the city was set to fall by at least 50 per cent which will have a severe downward flow on to economic activity in Australia’s biggest city.
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He tips the big banks will be reporting a significant rise in their problem loans — particularly if global interest rates rise on the back of US tax cuts, though not in the current reporting season.
He says the level of apartment decline is much greater than most were predicting three to six months ago.
The repercussions will quickly spread to Melbourne, although the blows may not be as severe because apartments are much cheaper.
"Brisbane is already in trouble so may be insulated from further big falls," he wrote."
"Those looking for a fall in Sydney dwelling prices will be cracking the champagne today but unfortunately the repercussions will be nasty so the celebrations may be short lived," he added.
"If you want a headline figure, apartments sold as used apartments in the big Sydney apartment estates have fallen by at least 20 per cent.
"The fall rate for individual sales can rise to 25 per cent," although no further details were given.
"However the price fall in new apartments bought either off the plan or as the developer sells a completed apartment are down in the vicinity of 12 per cent."
He blames fewer deductions from depreciation for the gap.
"Very quietly in the last budget, Treasurer Scott Morrison stopped the deduction of depreciation on used apartments from July 1, 2017.
"That means that for an investor, a used apartment is now worth substantially less than a new apartment — hence the 20 to 25 per cent price fall which is greater than the new apartment decline."
He says the 20 to 25 per cent fall in used near city apartment prices will not be duplicated across the Sydney dwelling market "but auction clearance rates will stay low or fall back and many areas will be soft."
Gottliebsen concluded his article series with the claim the "most dangerous people" are real estate agents "who will be spruiking that there is no crisis and regulators who don’t understand the power of what they have unleashed."
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Gottliebsen says some Sydney unit prices have fallen 25 percent as market has cracked

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“What type of investment property should I be looking for?”
According to quantity surveyor Washington Brown CEO Tyron Hyde, tax driven investments are not what an investor should focus on while buying an investment property.
Hyde was speaking at a webcast to address the issues around the new depreciation rules announced in the May 9 Federal Budget. 
<a href="https://washingtonbrown.pages.ontraport.net/budgetchanges" target="_blank">The Budget</a> sees <a href="https://www.urban.com.au/news/69960-property-investors-to-lose-depreciation-deductions-on-furniture-2017-budget" target="_blank">rules being tightened</a> around what can be claimed by property investors, specifically around depreciation deductions.
While for commercial or industrial properties nothing has changed and investors can still claim depreciable benefits and building allowance benefits, but the “investment focus of an investor or should not be about the tax driven benefits”, according to Hyde.
“You should be focusing on other things such as the infrastructure, yields etcetera, and then make the tax benefits work for you,” said Hyde in response to a question from a listener.
He acknowledged that it was easier said than done, but that should be the focus. Of course, commercial and industrial properties will still be able to reap the benefits of depreciable plant and equipment assets. 
Hyde said the government has targeted residential properties for the new depreciation rules. 
“In reality, let’s face it, they’re really targeting Sydney and Melbourne because someone who’s owned a property in Perth isn’t jumping up and down saying, I’ve got all these depreciation benefits when their property has gone backwards, right?”
“So in my view it is a Sydney and Melbourne kind of focus tax driven budget measure.”
But while the government’s announcements seek to address housing affordability issues, the RBA is equally concerned about the commercial property market because of a number of deals that have “ridiculous yields”.
But the government has left commercial properties continue the way they are for now because there’s a lot of big players in commercial.
He cited the example of Lendlease, “so when they buy a shopping centre, they can’t claim the air-conditioning in their shopping centre, that would be difficult”.
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New tax rules for residential properties driven by Sydney and Melbourne prices: Washington Brown's Tyron Hyde

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Investors in residential property, particularly strata units, will be hit hard after the budget announcements, according to quantity surveyors Leary &amp; Partners.
The budget has stripped investors buying second-hand residential properties of a major tax deduction, said quantity surveyor and tax law expert Kaylene Arkcoll. 
Pre-budget there was much speculation about limits on negative gearing, but the government unexpectedly announced it was restricting depreciation claims by investors.
"Purchasers of second-hand residential investment units have lost their ability to claim depreciation on plant and equipment which is part of the property at the time of purchase,” said Arkcoll, saying it was one of the standard forms of residential investment deduction.
The government will limit plant and equipment depreciation deductions to outlays actually incurred by investors. There is no lead-time with these changes and apply to all contracts after Budget night.
The change is forecast to save $260 million dollars over the next four years.
Depreciation claims on investment properties is a powerful driver for most investors, said Arkcoll. 
For second-hand residential properties, the budget blocks this avenue of investment joy for everyone except investors who carry out renovations or replacements. 
"Older building stock may now be less desirable,” said Arkcoll. 
Under new rules coming into effect from July 1, <a href="https://www.urban.com.au/news/69960-property-investors-to-lose-depreciation-deductions-on-furniture-2017-budget" target="_blank">depreciation deductions for plant and equipment </a>items such as washing machines and ceiling fans will only be allowed if the investor actually bought them. It is described as an “integrity measure" and is intended to address concerns that items are being claimed as tax write-offs by successive investors in excess of their actual value.
The changes will apply to any items purchased after budget night, May 9, but existing investments will be grandfathered.
Details of the policy are still limited but Arkcoll said that it appears that:
- The intent of the policy is to restrict depreciation claims to items purchased and installed in the property by the claiming taxpayer. 
- Depreciation deductions will remain available for items that are part of a new property purchased from a developer, although this is not explicitly stated in the budget papers. 
- Subsequent purchasers of the property will no longer be able to claim depreciation based on the second-hand value of the plant and equipment.  
- Taxpayers already depreciating plant and equipment can continue to claim deductions in the current manner.
"The removal of depreciation claims will have a double impact on strata property owners", she said.
"They will lose both the claim for depreciable items inside their unit and depreciation of their share of common plant and equipment. This will mean a reduction in annual tax deductions that in the early years of ownership range from approximately $3,000 for a simple unit to over $40,000 for an upmarket unit in a high-rise development."
She said that till more details are available, i.e. when the draft legislation is released, it would be difficult to fully assess the ramifications of the budget announcement. 
"The elephant in the room remains the government's ability to pass such a substantial change through a volatile senate,” Arkcoll said.
"Thankfully, there has been no change to the 2.5 percent Division 43 construction allowance which applies to most properties constructed in the past thirty years.”
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Tax Depreciation

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