Case study:
An older unit built in 1970 purchased for $400,000

The following table provides a summary of Stephanie’s scenario for the first full year of ownership, both before and after depreciation was claimed.

An old unit (1970) purchased for $400,000
Scenario without depreciation claim
Annual income ($440 x 52 weeks) $22,880
Annual expenses $30,629
Pre-tax cash flow (expenses less income) -$7,749
Total taxation loss -$7,749
Tax refund (tax loss x tax rate of 37%) $2,867
Annual costs of the investment property (pre-tax cash flow + tax refund) -$4,882
Weekly cost of the investment property -$93
Scenario with depreciation claim of $6,900
Annual income ($440 x 52 weeks) $22,880
Annual expenses $30,629
Pre-tax cash flow (expenses less income) -$7,749
Total taxation loss (pre-tax cash flow + depreciation) -$14,649
Tax refund (tax loss x tax rate of 37%) $5,420
Annual cash flow of the investment property (pre-tax cash flow + tax refund) -$2,329
Weekly cash flow of the investment property -$45
Difference of $48 per week

A BMT Tax Depreciation Schedule reduced Stephanie’s annual outlay for the property to $2,329 per annum or $45 per week. This was a difference of $48 per week or $2,553 in just the first 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:
A new unit purchased one year ago for $450,000

An apartment purchased for $700,000

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

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