WRC Quantity Surveying

South East Queensland’s specialist Quantity Surveyors for Tax Depreciation

February 24, 2021

Is Your [Older] Property Worth Depreciating?

If you have an older investment property  -and –

want to pay less tax – stay right here 

because you are in the right place 

Investors with older houses are paying too much tax. And a common blunder – virtually everyone makes – means they’re missing out on tens of thousands in tax savings…

Take for example, a new client who just turned a terrible housing investment situation into a great one. And now he’s saving tens of thousands in tax, simply doing one thing…

 And every investor with older property can do the same.

 But first…

 Nearly every owner of an older house asks me the same question…

 “My house is old…is it still worth doing?”

 …Yes! Old property is worth doing. 

 And can even be more worthwhile than many newer properties! 

 

 Let me explain…

 

A lot of developers – and property experts – say old houses are terrible for tax saving…and all the ‘good money’ is found only in fancy new homes. 

 But as the saying goes…putting salt in my tea won’t make yours any sweeter. 

 And developers have a vested interest in pushing new stock. 

 After all, they sell new houses – not old ones. 

 Even some accountants say older houses aren’t worth doing…and it blows my mind.

Wouldn’t it be better for their client to save a few hundred extra in tax each year, than to let the ATO collect it and lock it away in their coffers?

Regardless, older properties have mountains of depreciation in them…if…assessed properly.

 Plus their Capital Growth almost always beats the pants off new houses! 

 

And I can say that with confidence…

 Over the past 13-years I’ve seen older houses prove their worth time and time again. 

When assessed properly, older houses have bucket-loads of hidden tax savings unlocked and turned into cashflow for the owner. 

 

…Now, if you have a brand new cookie cutter house – this page won’t interest you much

 I hate to say this but…you can possibly get everything you need from an entry-level report by an entry-level provider. 

 But…

 If your property was built before 2001 this article will be of most interest to you. As you are exactly who should be reading this.

 

attention to detail has enabled me to claim maximum deductions

“Will was absolutely fantastic to deal with. His knowledge and attention to detail has enabled me to claim maximum deductions of my rental property. I can’t recommend WRC Surveying enough!”

Fabian D. – Coorparoo, Brisbane

exceeded expectations

“I have used Will for two of my investment properties and he has exceeded expectations both times. He was easy to deal with and extremely thorough in preparing the schedules. I will definitely be recommending him to friends and family”

Tim K. – Ormiston, Brisbane 

Will did an excellent job

“I am a taxation professional who recently engaged Will to assess several properties for depreciation/capital works purposes. Will did an excellent job, his final report was well constructed, easy to follow and fairly seamless with what I had done to date tax-wise”

Robert Daley – Enoggera, Brisbane

About me…

My name is William Callaghan. I’m the founder of WRC Quantity Surveying. And have been a QS since 2008. 

Infact, I’m a 2nd generation QS – trained by my Father, Ron Callaghan. 

…And as it turns out, I’m one of only two 2nd generation QS’s in Australia.

Under Dad’s tutelage I learnt everything I need to know to ferret-out every dollar in deductions for you. 

But picking the right tax depreciation guy (Quantity Surveyor) is like picking the right mechanic for your car…

…there’s lots of specialised sub-niches under the one qualification.

Say for example you had a highly tuned V8 turbo-diesel 200 series Landcruiser running 33 inch mud tyres and twin 3 inch exhausts…

Would you take it to a motorbike mechanic for servicing…or would you take it to a performance diesel specialist? 

They’re both mechanics afterall. 

And if you had an all original 1973 XU-1 Torana in Sunburst Yellow, would you take it to a modern Euro-Car tuner to tweak your triple Strombergs? Or would you take it to a classic muscle car mechanic who does it everyday?

…It’s the same for Tax Depreciation. 

  • Some guys are estimators – who do a bit of tax depreciation on the side

 

  • Some guys focus mostly on Body Corporate Insurance reports…only to dabble in tax depreciation when it pops up

 

  • Some guys do lots of tax depreciation…but only on brand new houses. Because the builder provides all the costs and they don’t need any historical costings knowledge. 

…But almost none are highly specialised in old houses. 

Which brings me back to the terrible situation a new client of mine was in…

Late in 2020 I met Rodney. A property investor who is now one of my VIP clients. 

And here’s what he – very kindly – wrote for me…

Hi, my name is Rodney. I have 7 investment homes dotted around Brisbane. Some old, some new and a couple of commercial ones too. 

When I first got into property in 2013, I wanted it to be hands-off investing. 

It’s true. Once I found a property I liked, I let the property manager and my accountant handle everything. 

My aim has always been to leave my children with more than what my parents were able to leave to me. 

Back in 2012 I was 47 with only my house to my name. 

And I knew just working my job and paying off the house wouldn’t be enough financial security. 

But my Accountant was into property and introduced me to the benefits of property investing…and what a Tax Depreciation Report did. 

And once I understood the concept of buying, depreciating and buying again, I was sold on the idea of owning as many properties as I could. 

So I left it to him to sort the reports on every new purchase I made.  

But recently I moved house and changed accountants to someone closer to home. It wasn’t until [October 2020] that my new accountant questioned the reports I’ve been using. 

His exact words I can’t remember but were something like “you’re not claiming anything worthwhile…who did the reports?”

Turns out my old accountant used a Quantity Surveyor – qualified…but inexperienced – to do the reports. 

My Morayfield house was only claiming $384 per year in deductions. With my Samsonvale house getting just $1,622 per year. 

I was shocked. I’d trusted my old accountant with everything. Now I needed to search for a fix. 

So, my new accountant recommended I do three things. 

  1. Throw out the old reports
  2. Submit amended tax returns (at $200 per property) for all 7 houses

And his third suggestion was to talk to Ron Callaghan and his son William Callaghan, whom he said were his go-to guys for older property depreciation reports. 

I didn’t know what made William and Ron go-to guys…until I saw the results they got me. But I’ll get to that soon. 

In our getting to know each other, I found out William’s been doing tax depreciation for years and was a qualified landscaper before that.

So he’s all over the costs for fencing, concreting, retaining walls and all that stuff. 

And while Ron is also a full time Quantity Surveyor, he’s spent the past 45 years flipping and building houses on the side. 

So he knows the ‘real’ costs for just about every kind of renovation you can think of. 

…Long story short, we had all the properties reassessed and amended returns submitted. 

All that did cost a bit in the end. $1,400 to have my returns amended – by my new accountant – plus the cost of the new reports through William. 

But it was worth every cent!

My Morayfield deductions jumped from $384/year to $4,227 per year. 

And my Samsonvale property was even better. Going from the $1,622 to $6,505 per year. 

I asked William how he did it and his answer was surprisingly simple…

“I just walked around your property. Noted all the renovations and claimable items. Put an accurate value on them…Then worked out the new totals”.

Unfortunately…

…the ATO wouldn’t allow me to amend my 13/14, 14/15, 15/16 or 16/17 returns as they said too much time has passed. So I can’t ever get back the extra tax I paid. 

Will even worked that out too… 

$34,904 (for the two properties) that I should never have been taxed on. 

But at least I’ve stopped the waste now. 

That did irritate me. And I questioned my old accountant about the mess. 

…I never heard back from him.

And I regret not knowing to get William and Ron to do the reports back in 2013. 

It was a lesson learnt. 

But I’m hoping it’s a lesson you won’t have to learn. I’ll always use William to do my Tax Depreciation Reports and I hope what I’ve said means you do too. 

And I’m definitely going to be handing over a significant property portfolio to my children down the road. 

*I’ve written this for William to show my gratitude for the tens of thousands in tax he’s saved me. 

…Simply by doing the job properly. 

*****

The key to getting more of your tax back from the ATO

 The big tax depreciation companies are volume based providers. 

 But churning out 30, 40, 50…even..350 reports – per day – does not sync with maximising tax savings. 

 …And you want to take advantage of every tax deduction entitlement available. 

 So you need someone very highly skilled – on-the-ground – inspecting your property. 

 

  • Not a ‘tick sheet’ guy with two days training 

 

  • Not a building and pest guy doing it on the side 

 

  • And not even a junior Quantity Surveyor just cutting their teeth

 

You want someone who knows old houses backwards. 

 …Like a 2nd generation Quantity Surveyor. 

 But high-volume companies simply don’t have that many skilled Surveyors on staff. 

 …it’s a small profession…with just 60 or so new graduates nationwide each year. 

 

And with so many multi-million dollar construction projects going on – there’s probably not even enough skilled QS’s in the country to fill the ranks at just one of the big companies.

And that’s where owners of older properties are losing thousands of dollars each year in unclaimed tax deductions. 

“If big tax depreciation companies truly wanted to ‘help investors maximise their tax savings’…why do they shy away from the harder, older properties – when there’s plenty of savings to be found?”

“Depreciating old houses is an art in itself”

 And only a handful of tax-dep providers have the right balance of skills and time to handle them competently. 

Yet many companies can’t – or won’t – put in the time and overheads to get clients the best result.  

They simply fob them off. 

After all, they want the easy jobs with higher profit margins…less work and less skill needed.

…And this is perhaps where the ‘vibe’ that old properties aren’t worth doing comes from.

 

ready in a flash

“After an informative helpful chat with Will he had my depreciation schedules ready in a flash!!!!! I highly recommend his services!!!”

Thomas Hardiman, Eagleby

we’ve been benefiting financially each year

“Will was recommended to us to do our rental depreciation schedule. Very happy with Will’s work and we’ve been benefiting financially each year. Will be using Will services for our next property and would recommend him to others.”

Marc Eden, Cleveland

delighted with the reduced tax liability

“I engaged WRC Quantity Surveying to assess a rental property. Not only did they promptly reply to my initial email, but the assessment was conducted very soon thereafter. Their report was professional, timely and detailed. I was delighted with the reduced tax liability on foot of their excellent work! I would highly recommend them!”

Tara Magdalinski, Maroochydore

*****

But I do know how to milk an old house of every-cent of tax deductions. 

There’s a simple yet often overlooked trick to it…

That is…send a very experienced Quantity Surveyor to your house to do the inspection. 

That’s what dad and I have been doing since 1994. 

It seems simple… 

Yet it guarantees you’ll pay minimal tax.

And it guarantees you and your accountant won’t get an ATO audit because of a dodgy depreciation report. 

“But I can’t do every job that comes my way”

Otherwise I’d become one of those volume based companies- fobbing off the harder jobs to make way for multiple easy ones. 

So I cap my intake at 13 jobs per week. 

That’s just 3 per day and a half day on Fridays for bookwork. 

Here’s What you get [with me]:

 Only with me will you get a report where a QS does every-step of the process. From sending the quote – to issuing the final report. 

 …and everything in between

 Your report will last 40-years (or until you no longer rent out the property). Whichever comes first. 

 You’ll receive a ‘full depreciation’ report. Which means all methods of depreciation are included

  • Capital works Deductions @ 2.5% pa
  • Diminishing Value Method
  • Prime Cost Method
  • Low Value Pool Method
  • Capital Loss Schedule 

 And you’ll get a lifetime of FREE updates. 

 

That means, should you replace something like an air con unit or repaint the house, I’ll update your report at no cost. 

But…more extensive renovations may have a small cost attached. It all depends on the work you did. And I price them on a case-by-case basis. 

 

This 1960’s 2 bedroom unit may look too old to give you tax savings.

But the owner is actually getting a $2,670 per year in deductions. BURLEIGH HEADS, Gold Coast

 

 

 

Once you have your report all you need do is have your accountant open the file and punch in the numbers each time you do a tax return. 

 

…And that’s it!

 

Again, to maintain quality I severely restrict the number of clients I take on each week to just 13. 

 I have chosen not to be a volume based business. 

 I’d rather have less output – to a higher standard. And not run around like a headless chook hoping I’ve kept on top of things…well enough. 

So, the sooner you act – the sooner you’ll get your report. And the sooner you’ll know you have done everything in your power to pay minimum tax. 

 Some companies will charge you a lot more than I do…and you still won’t save you all the tax you’re entitled to. 

 Some companies will charge a lot less than I do…but you’ll pay for it in the end. 

 …through the bigger tax bills you could have avoided. 

 And sticking your head in the sand and doing nothing is even worse. 

 …but the ATO will love you for helping to fill their coffers. 

 And when you get a tax depreciation report – through me – you’re going to get a done-for-you service. 

Where everything is taken care of. 

 Plus you’ll be guaranteed nothing will be overlooked in the efforts to maximise your tax savings.

 

I typically charge $685 incl. GST for a Depreciation Report. Which is about half what a good accountant would charge you just to do your tax return.

 

Why $685… 

 

Because I put in so many hours to nut-out every single claimable item – so you get the biggest deductions possible. 

 But right now I’m running my 2018/2019 pricing. 

 That’s just $585 incl. GST for the exact same report with the exact same degree of care and attention to detail. 

 …But It’s only for a short while!

 Why go back to a price I was charging nearly 3 years ago?…

 Because I’ve just put on another Quantity Surveyor to help with the inspections. And I need to keep him busy. 

 So I’d rather operate on lower margins for a short while and ensure I have enough work – for him – than pay him to do nothing.

 

“If you have an investment property older than 2001 you’re in the right place”

 Older houses are my specialty. 

 And by filling in this form (below) to get a quote, you’ll be making the first move in guaranteeing you maximise the growth potential of your personal wealth.

So I can send your quote to you
...so I can provide a guaranteed minimum yealry deduction amount
If you've got any extra info about your property - this is a great spot to put it

After you hit the send button – on your enquiry – I’ll receive your email and put together your quote and an estimated yearly deductions guarantee. 

And I’ll do my best to get your quote to you within 2hrs

Then you can choose to move forward and get your property inspected…or simply move on to another provider. 

And don’t worry about getting spammed once I have your email! 

I don’t do that. 

Infact, I rarely even contact paying clients. 

…And only to alert them to additional tax savings they can take advantage of.

Plus…with every quote I’ll also provide – free of charge – three RpData generated reports about your property. 

 

If you were to buy these yourself RpData would charge you $80ea. 

 

But with your quote – they’re free. Not a cent!

 

And you can use them to get an advantage over other investors in your area. 

  • My Guarantee to you

My reports are really easy to understand and use. Plus they’re formatted in a way that allows for easy updating. 

So when you do repairs or renovations I can simply adjust your report hassle free and at no cost. 

But if your accountant doesn’t simply love the report I’ll give you a full refund. 

No questions asked.

Plus…if I can’t get you the promised deductions I said I could – I’ll refund you 100% of my fee. 

…And you can continue to use the report and keep it for free.   

So when I say there’s no harm in getting a quote I really mean it. 

Just fill in this form and get a quick – hassle free – quote and your guaranteed yearly deductions estimate. 

So I can send your quote to you
...so I can provide a guaranteed minimum yealry deduction amount
If you've got any extra info about your property - this is a great spot to put it

But right now you may still be thinking your property isn’t worth depreciating. 

And that’s a fair call. Some properties really aren’t. 

But without finding out right now you will never know. 

My mother-in-law always says “when you assume you make an ass out of you and me” 

…Not sure if she’s having a go at me but…it certainly applies to getting a quote. 

  • Your property could be a goldmine of tax savings – or it may not
  • You could save tens of thousands in tax – or you may not 

But you’ll only know for sure if you get a quote. 

If you think saving thousands of dollars on tax each year may help you secure your safe retirement then please don’t waste any time in getting your quote.

As i mentioned earlier. I cap my output at just 13 reports per week. 

And if you wait too long you may miss out on legitimate tax saving entitlements.

Simply enter your basic info in this secure form and I will personally be in touch.

And remember. I hate spam as much as you do – so I’ll never spam you if you feel we are not a good fit for you. 

Thank you for your time. And stay safe!

So I can send your quote to you
...so I can provide a guaranteed minimum yealry deduction amount
If you've got any extra info about your property - this is a great spot to put it

Some FAQ’s

How do you find more tax deductions in my property than the other guys?

It all comes down to the onsite inspection. 

Without really high level knowledge of [historical] construction costs and design trends, an inspector simply can’t identify all the deductible items – or their value. 

And to do that it takes someone with a lot of experience. Otherwise, they walk right by deductibles. 

Meaning you miss out on tax savings. 

How will you know my property is ‘worthwhile’ doing before I spend any money?

Along with my quote I’ll also provide an eyeball estimate of what you can expect to claim in depreciation deductions.

I do that by researching your property online. 

Yes, this takes me a little while to put together your tailored quote – but it means you know exactly what you’re going to get. 

How soon do I need to get the report sorted?

The sooner the better… 

Ideally, you’ll have the property inspected close to the date tenants first move in. 

But, that doesn’t always happen. And that’s ok. 

However, you don’t want to dawdle.

Recently the ATO put a time limit on when you can claim for older tax returns. 

Basically, leave it even a day too long and you could miss out on an entire years worth of tax deductions!

Can I claim a tax deduction for my report?

Yes! Our fee is a tax deductible cost – just like your accountants fee. 

So even the cost of the report adds to your deductions.

How often do I need to do the report?

Just once…

We will prepare the report and it will last 40-years. 

Why so long?: The ATO says a building/structure has a useful life of 40-years. So that’s how long our reports run for.

 2.5% pa x 40 years = 100%

…Of course, if you do major renovations you’ll probably need to have the new works assessed too. Otherwise you may miss out on extra tax savings. 

 

So I can send your quote to you
...so I can provide a guaranteed minimum yealry deduction amount
If you've got any extra info about your property - this is a great spot to put it


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