Case study:
An apartment purchased for $700,000

The following scenario shows Rachel’s cash flow both with and without a depreciation claim.

An apartment purchased for $700,000
Scenario without depreciation claim
Annual income ($600 x 52 weeks) $31,200
Annual expenses $46,396
Pre-tax cash flow (expenses less income) -$15,196
Total taxation loss -$15,196
Tax refund (tax loss x tax rate of 37%) $5,623
Annual costs of the investment property (pre-tax cash flow + tax refund) -$9,573
Weekly cost of the investment property -$184
Scenario with depreciation claim of $14,488
Annual income ($600 x 52 weeks) $31,200
Annual expenses $46,396
Pre-tax cash flow (expenses less income) -$15,196
Total taxation loss (pre-tax cash flow + depreciation) -$29,684
Tax refund (tax loss x tax rate of 37%) $10,983
Annual cash flow of the investment property (pre-tax cash flow + tax refund) -$4,213
Weekly cash flow of the investment property -$81
Difference of $103 per week

Before claiming depreciation, Rachel would experience a loss of $184 per week for the first year of ownership for her property. Simply by claiming depreciation, Rachel was able to turn her cash flow into a more positive one, and reduce her loss to just $81 per week. In total, BMT Tax Depreciation saved Rachel $5,360 in the first full financial year.

Assumptions and disclaimer

Case studies and figures are based upon tax depreciation schedules completed by BMT Tax Depreciation and do not represent any particular person or investment property scenario. The information provided is a general guide and does not constitute financial, legal or taxation advice. All figures are supplied as examples and may not represent your personal circumstances.

You acknowledge and agree you must undertake your own analysis and obtain independent legal, financial and taxation advice before using, relying or acting on any information supplied on this website.

Neither BMT Tax Depreciation, nor its directors, shareholders or advisors make any representation or warranty as to the accuracy or completeness of information found in these typical examples. Nor will they have any liability to you or any other party for any representations (expressed or implied) contained in, or any omissions from, that information.

The tax depreciation deductions in this case study have been calculated based on the diminishing value method of depreciation and are based upon a first full year of ownership. Marginal tax rates relevant to 2014 – 2015 financial year have been assumed.

Related case studies:
An older unit built in 1970 purchased for $400,000

A new unit purchased one year ago for $450,000

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Find out how much you could be claiming each year

Estimate your likely deductions using the free BMT Tax Depreciation Calculator today. Alternatively complete this form and one of our staff members will be in contact to provide a customised tax depreciation estimate for your property.

As you can see, property depreciation can make a significant difference to a property investor’s cash flow each financial year.

How do I organise a schedule?

Engaging BMT Tax Depreciation to complete a tax depreciation schedule for your investment property couldn’t be easier:
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Property details

We’ll collect property details, then contact your Property Manager or Tenant to arrange access to complete a property inspection.

Claim deductions

Your schedule will be available within 5 – 7 days of all information being gathered. BMT can even forward your schedule to your Accountant directly, saving you time.

It’s that simple. A depreciation schedule could save you thousands each financial year.
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