Depwest provide you with a comprehensive report which is valid for the lifetime of the property – commonly a 40 year report depending on the age of the property.

Site inspections are necessary to satisfy ATO requirements, a qualified and experienced inspector will visit your property, measure the building, assess the construction and record all depreciable plant and equipment items (including common areas in a strata complex) – Our staff have the expertise and knowledge to know which items are depreciable and how savings can be legitimately achieved, guaranteeing you won’t miss out on any deductions.  All the documentation is securely stored and can be retrieved and used as evidence in the event of an audit.

The report always starts from the settlement date irrespective of when the property was first leased.

Within the Perth Metropolitan area – We have a very efficient turn-around time with inspections generally being booked within 1-3 business days and the completed report will then follow two business days after the property inspection.

We also have an inspectors based in Port Hedland & Eastern States so our turnaround time for this locality is also very efficient.

Periodic trips are made to the remaining regional areas within WA – the trip needs to be both financially feasible and time efficient – therefore we generally need 3 / 4 applications in an area before we make a regional trip.  The client can pay additional expenses if they do not wish to wait – we can provide a quote if you require.

Please contact us as we may have a trip scheduled to your area!

Feasibility study:

• The construction completion date (link Division 43 – Capital Works Allowance)
• The settlement date  i.e. (link Division 40 – Plant and Equipment)
• Renovations/additions prior to purchase (dates must be provided so we can determine a value)
• If there is any post purchase expenditure?  The client must provide us with an itemised list with cost and date.

Unless they are otherwise qualified, valuers, real estate agents, accountants and solicitors generally have neither the relevant qualifications nor the experience to make such an estimate.  (Tax Ruling 97/25 of the Income Tax Assessment Act (1997))

Accountants can apply actual costs, but are not qualified to estimate construction costs.

No, it is better if you obtain the depreciation schedule before you start renovating so that you can claim on the original plant and equipment included in the sale (as this is revalued from the settlement date) You can then provide your accountant with receipts in order to claim for your renovations or we can create an addendum report to account for this.

The settlement date will be the date the property transferred to you.  The client must obtain a valuation in order to determine the hypothetical purchase price – in many cases they will already have this.

We do not ask to see any receipts; however you should have receipts in the unlikely event of an ATO audit.

The ATO stipulates that human/man made elements such as structures, stairs, fences, reticulation or other material objects are claimable but the actual natural elements such as elevation, gardening etc. are not claimable.  A breakdown of the landscaping expenditure will ensure we get the maximum return on your investment.

The ATO defines the effective life of a depreciating asset is how long it can be used by any entity for a taxable purpose, or for the purpose of producing exempt income or non-assessable non-exempt income

• having regard to the wear and tear you reasonably expect from your expected circumstances of use,
• assuming that it will be maintained in reasonably good order and condition, and
• having regard to the period within which it is likely to be scrapped, sold for no more than scrap value or abandoned. (www.ato.gov.au)

A property valuation is the price at which a property would trade in a competitive open market.  A depreciation schedule is different, as we work out how much the property would have cost to build on the year it was built i.e. an historical construction cost (capital works allowance).  We then put a value on the individual plant and equipment elements in the property.

Unless they are otherwise qualified, valuers, real estate agents, accountants and solicitors generally have neither the relevant qualifications nor the experience to make such an estimate.  (Tax Ruling 97/25 of the Income Tax Assessment Act (1997))

This is a common question; thankfully most people understand when we advise them that it is very difficult to provide an estimate without actually conducting the inspection.  As a rule, new properties tend to have more depreciable allowances.  In general terms the amount of depreciation can be anywhere from $1,000 to $15,000 in the first full financial year – obviously depending on the property.

We do not usually provide an estimate, but we are happy to conduct a free, no obligation desktop feasibility assessment.  This study will involve a number of simple questions regarding the purchase and the property, we will be able then to explain exactly why it is or is not feasible.

Also, Depwest guarantee if we do not attain at least double our professional fee in depreciation entitlements in the first full financial year – we will refund the fee and provide the report at NIL cost.

The Diminishing Value Method assumes that the value of a depreciating asset decreases more in the early years of its effective life.

Items to the value of $300 or less can be claimed as an immediate deduction.

Low value and low cost pooling for assets costing $1,000 or less – accelerating your claim as these items can be claimed at 18.75%, in the first year and at 37.5% for each subsequent year after.

If your aim is to receive a greater return on your investment i.e. achieve greater deductions as quickly as possible – then this is the right choice, e.g. if you are a short term investor.

The Prime Cost Method assumes that the value of a depreciating asset decreases uniformly over its effective life.

Allows investors to rely on a more consistent depreciation claim each year – a uniform rate until the full value of the assets are claimed, providing investors with a constant projection of their tax deductions.

Suitable for investors looking to maximise their depreciation claim in later years, e.g. Investors who will live in their property for the first few years, those whose income is expected to substantially increase in the future or businesses.

Your accountant will be able to provide you with tailored advice, as they will be aware of your financial structure.

The cost of land on which the rental property is built, the expenditure of clearing the land prior to construction and permanent earthworks cannot be included in your depreciation schedule.  Therefore any costs that relate to the land or titles, such as subdivision costs and legal fees are also not depreciable.

Landscaping is also not considered depreciable – however the ATO stipulates that human/man made elements such as structures, stairs, fences, reticulation or other material objects are claimable but the actual natural elements such as elevation, gardening etc. are not claimable.  A breakdown of the landscaping expenditure will ensure we get the maximum return on your investment.

We recommend that you speak to your accountant for advice on how to claim for the items that are not considered depreciable.  

In short no, it is an ATO ruling that you can only claim for the money you have actually spent and are able to substantiate with a receipt.