My Principal Property is Now a Rental Property

…just turned your principal property into an investment property?

Now that your Principal Place of Residence (PPR) is used for “income producing purposes,” you’ll be taxed on the profits. So it’s best to take advantage of current tax laws to minimise your tax. By drawing on ATO legislation, you can reduce your tax payable—improving your cash flow. To do this, you need a tax depreciation report.

If you’re not sure what tax depreciation is, read this first.

Note: former PPR properties will also need a market valuation (aka: Capital Gains Tax Valuation) in order for the ATO to calculate any future Capital Gains Tax (CGT).
I can do this for you too. And have lost count of the number of CGT reports I’ve produced. Always in a favourable tax advantage way too.

1950’s House

Carina 1950’s built Queenslander
$4,625/yr in deductions & $23,125 in 5 years
Major Renovations

10 year old House

North Lakes 2011 Built House
$5,438/yr in first year
$27,190 in 5 years
Minor renovations

’92 Built House

Robertson, 1992 built house
$3,200/yr in deductions and $16,120 in 5 years
Minor renovations

What’s claimable under tax depreciation legislation?

Firstly, it helps to know what counts as a “depreciating asset.” The ATO defines it as “an asset that has a limited effective life and can reasonably be expected to decline in value over time used.”

That’s a mouthful, but roughly translates to “everything”—with the exclusion of plants, turf and earth.

Note: An ABSURD call was made by the ATO to legislate changes to tax depreciation reporting for former PPR rentals.

Basically, items technically known as “plant & equipment” can no longer be included in the calculations. You won’t be able to claim the upfront losses on these items anymore. But you will be able to mark them down as a Capital Loss when you sell the proeprty.

In my reports you’ll find these items re-categorised as “capital losses” and included in a Capital Loss Schedule. When you do sell, your Accountant will use this schedule to leverage as much CGT reductions as possible.

Is tax depreciation worth it?

In a nutshell, yes. But it does come down to four main factors:

  1. Condition of property
  2. Age of property
  3. Extent of renovations
  4. Size of property

You will almost certainly save money with a tax depreciation report. But to find out for sure, simply get a quote—it’s easy & free. All we do is ask you a few questions and we’re ready to go!
See how to slash your tax with one simple quote

Get Your Free No-Obligation Quote Here

Still have questions about claiming deductions from your former Principal Property?

…maybe these FAQs will help you

QUESTION: how do I know if my house is worthwhile doing a report?

Simple rule of thumb: Once you’ve got $40,000+ in claimable works – including renovations, improvements and makeovers – a Tax Depreciation Report will save you tax.

That’s because $40,000 in renovations is claimable at 2.5% pa.

…and that means you’ll get $1,000/yr in tax deductions

QUESTION: Do you have to inspect the property?

Yes.

I’ve found principal properties have bucket-loads of claimable works done to them. Most of which can’t be seen in online photos.

And if I can’t see them – I can’t include them.

…So that means you miss out on all those tax deductions.

That’s why I insist on inspecting all properties older than 4-years of age.

QUESTION: Can we claim for future work on the property?

Yes you can – with my Free Report Updates for life!

…if you add a new air con or oven, repaint the house or even replace the kitchen – just let me know the Cost and the Date and I’ll update your report at no cost to you.

It’s completely free!

vast knowledge

“While looking at different QS for our investment property I found Will to be the most approachable and forthcoming with his vast knowledge and felt comfortable in using his services. Was not disappointed and would recommend him to friends”
Glenn Robertson

Always good to support local businesses

“Will did a great job completing my surveying report promptly and for a great price. Always good to support local businesses. Would certainly recommend WRC, I will be using them for future investment properties”
Ian Goulding

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 very thorough in preparing the schedules. I will definitely be recommending him to friends and family”
Tim Kennedy

Finding out how much tax you can save all starts with getting your free quote…

And it’s easily done

Simply click here and you’ll be taken to an easy form to complete. ⤵️

Get Your Free No-Obligation Quote Here

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