Introduction
Investing in property is one of the most effective ways to build long-term wealth — but many investors miss out on a key benefit: tax depreciation. A professionally prepared depreciation schedule can significantly boost your annual tax return, delivering real financial gains year after year. This blog explains how tax depreciation works and how Red Dog Property Inspections can help you make the most of it.
Understanding Tax Depreciation
Tax depreciation is the gradual decline in value of the building and its assets, which the Australian Tax Office (ATO) allows investors to claim as a tax deduction. There are two main components:
- Capital works deductions – covering the structural elements of the building (e.g. walls, floors, roof).
- Plant and equipment depreciation – covering removable or mechanical items (e.g. carpets, blinds, hot water systems).
To claim these deductions, you need a Tax Depreciation Schedule — a document that outlines your eligible claims over the lifetime of your property.
Common Issues or Considerations
- Many property owners don’t realise they can claim depreciation on older properties, not just new builds.
- Without a depreciation schedule, investors may miss out on thousands of dollars in legitimate deductions.
- Depreciation claims must be ATO-compliant — general estimates or DIY reports are not accepted.
- Co-owners must have split schedules to reflect their ownership share accurately.
Solutions and Best Practices
- Arrange a depreciation schedule as soon as possible after settlement or completion.
- Ensure your report is prepared by qualified professionals, such as quantity surveyors.
- Update your depreciation schedule if you renovate or install new assets.
- Review your claims annually with your accountant to ensure all deductions are applied.
How Red Dog Property Inspections Can Help
At Red Dog Property Inspections, we work with fully qualified quantity surveyors to deliver detailed, ATO-compliant depreciation reports. Our schedules are tailored to each property and include:
- Capital works deduction calculations
- Depreciation on all eligible plant and equipment
- A 40-year year-by-year breakdown
- Split reports for co-owners, if needed
Whether you’re purchasing, building, or renovating, we help you claim the maximum deductions legally available — improving your cash flow and return on investment.
Conclusion
If you’re a property investor and haven’t organised a tax depreciation schedule, now’s the time. It’s a powerful tool to legally reduce your tax and optimise your investment’s performance.
Contact Red Dog Property Inspections today to arrange your schedule and start making your property work harder for you.
