Depreciation Myths & Misconceptions – Koste Chartered Quantity Surveyors
The Truth About Tax Depreciation: Common Myths Debunked by Experts
1. Myth: “My Property is Too Old to Claim Tax Depreciation.”
Reality:
You can still claim depreciation, even if your property was built before 1987.
What Can Still Be Claimed?
✔ Capital Works Deductions (Division 43): If renovations or structural improvements were made after 16 September 1987, you can claim depreciation on those works.
✔ Plant & Equipment (Division 40): If you install new assets, they qualify for depreciation, regardless of property age.
📌 Find Out If Your Older Property Qualifies: Request an Assessment
2. Myth: “Tax Depreciation Isn’t Worth It for Low-Cost Properties.”
Reality:
Even a low-cost investment property can generate thousands in tax deductions.
Why Depreciation Still Matters?
✅ Properties under $300,000 can still have $5,000+ in annual depreciation claims.
✅ Every tax saving adds up, improving cash flow and ROI.
✅ Koste maximises deductions by using real construction cost data, not generic estimates.
📌 Get a Free Depreciation Estimate: Check Your Potential Savings
3. Myth: “I Can Just Use My Accountant to Estimate Depreciation.”
Reality:
Accountants cannot legally estimate construction costs—only a Chartered Quantity Surveyor (like Koste) is qualified to do so.
Why a Tax Depreciation Report Is Essential?
✔ Accountants rely on reports from Quantity Surveyors (AIQS & RICS-certified).
✔ ATO requires accurate costings, not estimates, for depreciation claims.
✔ A professional depreciation schedule ensures maximum, audit-proof deductions.
📌 Get an ATO-Compliant Depreciation Report: Order Now
4. Myth: “Since I Bought a Second-Hand Property, I Can’t Claim Any Depreciation.”
Reality:
You can still claim depreciation on the building structure (Division 43) and any new assets you install.
What Second-Hand Property Owners Can Claim:
✅ Capital Works (Division 43): Even if you buy an older property, you can claim depreciation on renovations & structural upgrades.
✅ New Plant & Equipment (Division 40): If you install a new hot water system, air conditioning, or appliances, you can still claim depreciation.
📌 Find Out What You Can Claim: Get an Expert Assessment
5. Myth: “If I Claim Depreciation, I’ll Pay More in Capital Gains Tax (CGT) Later.”
Reality:
While claiming Capital Works (Division 43) deductions reduces the cost base for CGT, the tax savings from depreciation usually outweigh any future CGT liability.
Why Depreciation is Still Beneficial?
✔ Claiming depreciation improves your cash flow now, rather than worrying about potential CGT later.
✔ CGT discounts apply if you hold the property for more than 12 months.
✔ Many investors use tax savings to reinvest and grow their portfolio.
📌 Need a Tax Strategy for CGT & Depreciation? Book a Consultation
6. Myth: “If I Haven’t Claimed Depreciation Before, It’s Too Late.”
Reality:
You can backdate depreciation claims and adjust previous tax returns to recover missed deductions.
How to Backdate Depreciation:
✅ The ATO allows amendments for up to two years for individuals and four years for companies.
✅ If you’ve owned the property longer, future depreciation can still be maximised.
✅ Koste can prepare retrospective depreciation schedules to help reclaim lost tax deductions.
📌 Recover Missed Depreciation Today: Talk to Koste
7. Myth: “Tax Depreciation is Only for Residential Property Investors.”
Reality:
Businesses, commercial property owners, and tenants can also claim depreciation.
Who Else Benefits from Depreciation?
✔ Business Owners – Can claim depreciation on office fit-outs, furniture, and equipment.
✔ Commercial Property Owners – Can claim both Capital Works & Plant & Equipment depreciation.
✔ Retailers & Hospitality Venues – Can claim depreciation on shop fit-outs and commercial assets.
📌 Find Out How Depreciation Works for Businesses: Get a Custom Report
Next Steps for Implementation in HubSpot
1️⃣ Upload These Articles into your HubSpot Knowledge Base under "Depreciation Myths & Misconceptions."
2️⃣ Enable Chatbot Integration to provide accurate responses and correct misinformation.
3️⃣ Monitor Chatbot Interactions & Update FAQs as needed.