There is no better time of year for outdoor entertaining than summer. The season’s warm afternoons offer perfect conditions for barbecuing with friends or relaxing in the pool.
Australians love spending time outdoors, so it’s important to equip your investment property with assets that entice tenants to lease the property long-term and allow them to enjoy the property in summer.
While outdoor assets such as swimming pools, patios and outdoor furniture don’t come cheap, property investors can recoup some of the costs for these assets by claiming depreciation.
The below infographic shows some of the first full financial year depreciation deductions property investors can claim for common outdoor entertaining assets. Click on the image to expand.
The owner of this investment property could claim:
- $1,400 for the table setting
- $1,250 for the deck
- $660 for the barbecue
- $640 for the pot plants
- $400 for the cushions
- $375 for the sails
- $250 for the bench seat
- $200 for the fountain, and
- $91 for the ceiling fan
This adds up to an impressive $5,266 in the first full financial year alone, making it much more affordable to own an investment property.
Other outdoor assets which attract depreciation deductions include retaining walls, fences, clothes lines, garden sheds, solar lights and watering systems.
Investors can claim depreciation on assets for the duration of their individual effective life, as determined by the Australian Taxation Office.
Outdoor assets generally have shorter effective lives than indoor assets as they wear out more quickly and therefore need replacing sooner. As an example, indoor furniture can be claimed over 13.33 years whereas outdoor furniture can be claimed over five years.
Regularly inspect outdoor assets for wear and tear
Seasoned investors are aware of the importance of keeping tenants happy by ensuring items at the property are kept in a good condition.
Ensure you regularly inspect outdoor entertaining assets to check for any wear and tear. If your property has recently become vacant, consider making some improvements to your outdoor area to help attract tenants and add value to your investment property.
If you plan on removing and replacing old assets, you may be entitled to claim 100 per cent of the unclaimed value as a deduction. Contact BMT Tax Depreciation to calculate your unclaimed deduction on 1300 728 726.
To assist your decision of when to replace outdoor entertaining assets, use BMT’s Rate Finder tool to view the individual effective life and depreciation rates for the assets at your investment property.