Juggling priorities and stiff opposition makes the property management industry one of the most competitive out there.
Property professionals are constantly looking for ways to set themselves apart from the rest. One thing they shouldn’t discount to achieve this is educating landlords on what can make them more money from their investment property, especially big-ticket items like depreciation.
What is depreciation?
The physical element of a property depreciates in value, just like a new car does as soon as it leaves the dealership.
Depreciation is the natural wear and tear of a property and asset over time. While most thigs depreciate, only owners of income-producing property (investors and businesses) can claim it as a tax deduction each financial year.
How such a technical area can set you apart
Depreciation mightn’t seem like a ‘flashy’ topic to sell to your landlords as it’s a very technical area of taxation legislation (and that’s what accountants are for, right?).
But you can make a huge difference to your landlord’s cash flow by making them aware of this tax deduction. It’s different to any other they can claim as it’s a non-cash deduction, so they don’t need to be spend a cent to claim it.
Wouldn’t landlords already know about depreciation?
With over twenty years of experience, BMT has noticed some key facts among the property investor population. To name a few:
- Far too many don’t claim depreciation: The reasons people miss out on claiming thousands in depreciation deductions are many; they could simply be unaware of it, believe it’s unavailable to them or have fallen for the wrong advice.
- Those that do claim could still be missing out: Many investors are still failing to take advantage of the full potential of depreciation. This is usually because they use a ‘cheap and fast’ depreciation schedule that didn’t include a physical site inspection from a depreciation specialist. Some other reasons could be because they haven’t updated their schedule with recent improvements and renovations.
- Countless investors fall for the myths: There are a lot of depreciation myths out there, but you can make sure none of your clients fall for them.
One key myth is that older properties don’t hold depreciation at all, but this is rarely the case. Others believe that second-hand properties don’t have depreciation deductions available (false) or that depreciation only available on a full financial year basis (also false).
Start ensuring your clients make the most out of this lucrative deduction by obtaining an obligation-free depreciation estimate from BMT. This simple step can unveil thousands in deductions that your clients don’t know they are missing out on.
Numbers prove the value of depreciation
If your landlord clients aren’t sold on the idea that depreciation really makes a difference, prove your point with the numbers.
The below data shows some deductions landlords can expect from an investment property and the difference depreciation alone makes to their tax savings.
What do we provide to help you educate clients about tax depreciation?
We provide a range of additional free services to assist property managers such as:
- Educational training sessions on depreciation either face to face or via webinar. In these sessions we cover a range of frequently asked questions and explain how claiming deductions will help your clients
- Speakers at your next event or investor night. We will provide an engaging and knowledgeable presentation on depreciation to explain the cash flow benefits directly to your clients
- Articles for newsletters and publications which explain depreciation in an easy to understand way
- Co-branded tools and brochures such as our tax depreciation calculator which provides a depreciation estimate for any property. We can also provide printed materials for your office.