Failing to get your Depreciation Schedule done on time could mean that you could be missing out on huge amounts of depreciation and the tax benefits that come with that. So today I sit down with Brad from BMT Quantity Surveyors and we talk about when you should get your depreciation schedule done.
This is Part 5 in a 10 part series on Depreciation.
When should people go about getting a depreciation schedule done?
When you buy the property or at the end of the financial year means that bills are accountable at the end of the financial year.
You are going to need it for that tax returns due on the property so before you do your next tax return is ideal.
There is also that you can let your account adjust your tax for the year so you will get the money back straight away rather than waiting until the end of the financial year and the report will be so filed to do that.
There is an opportunity for investors who get their depreciation schedule done early to actually take that to their accountant and I guess bring that into play so that they get the benefits of that straight away rather than waiting until tax time.
It’s something you need to speak to your accountant to about first before you come and see us (BMT) because they’ll want to have a look at the rest of your situation and you probable are normal salary owner as opposed to a company, etc for that to work. But have a chat with your accountant about actually looking at adjusting your tax through the year as opposed to waiting until the end of the financial is definitely something worth considering.
So as you can see getting your depreciation schedule done in the first year or at worst in the first two years is extremely important, basically get it done as soon as possible, invest in it and it is a tax deductible expense so again you are going to get some tax back on what you spend anyway.
Being able to calculate how depreciation will affect your cash flow is an important step to take before you go ahead and jump into a property investment. The Advanced Property Calculator allows you to see the potential cash flow of a property before and after tax is taken into account. A must have tool for any property investor. Get the free eBook (inside On Property Plus)