In one of the most dramatic changes to property depreciation legislation in more than 15 years, Parliament has passed the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 as at Wednesday 15th November 2017 and the Bill is now legislation.
This has resulted in changes to the Income Tax Assessment Act 1997, the most significant of which denies property investors from claiming income tax deductions for the decline in value
of ‘previously used’ depreciating assets (plant and equipment) within residential investment properties.
The government’s intention in making this legislation amendment was to deliver an integrity measure which addressed concerns that some plant and equipment assets were
being depreciated by successive property investors in excess of their actual value. These changes affect investors who purchase second-hand residential properties after 7:30pm on the 9th of May 2017 by limiting the depreciation they can claim on existing plant and equipment assets.
The good news is that there are still thousands of dollars to be claimed by property investors. It is more important now than ever to talk to your accountant and engage a specialist Quantity Surveyor to ensure that property depreciation and capital gains tax deductions are maximised.
The team at BMT have prepared a short video to help explain the key points of this new legislation:
You may also like to review a comprehensive guide of the new legislation Essential facts: 2017 Budget changes and property depreciation
And of course, don’t forget to reach out to us if you still have questions!
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