What investors are asking at tax time
Drawing closer to the 30th of June, what’s become evident over the last few days, are two questions being asked by investors who already have a tax depreciation schedule for their property.
“How long does a BMT Tax Depreciation Schedule last for?” and “If I’ve already had a schedule prepared for my investment property do I need another one for this year’s tax return?”
How long does a BMT Tax Depreciation Schedule last for?
A BMT Tax Depreciation Schedule lasts for 40 years or the effective life of the property.
If I already have a BMT Tax Depreciation schedule, do I need another one for this year’s tax return?
Your BMT Tax Depreciation Schedule done lasts the life of the property (40 years), so you do not need to have one prepared every year at tax time. if you’ve done renovations to your property since your depreciation schedule was prepared you’re going to need an updated schedule to show those costs and any new depreciation claims.
For example; If you’ve replaced something like a Hot Water system, you can do what’s called “scrapping”, where you can claim the total residual value of the Hot Water system (the cost of the Hot Water system less any depreciation already claimed). You can then begin to claim the depreciation costs of the new system.
If it’s only one item, your Accountant should be able to update your schedule for you. Depending on your schedule, for one item we’ll update your schedule for free. If it’s more than one item and you want the changes shown all in the one report, we’ll be able to update your schedule for a small fee.