Commercial Property
Individuals and Businesses that own commercial property used for income-producing purposes are entitled to claim depreciation against their personal taxable income and also the business. Some examples include commercial offices, retail food franchise business such as a KFC or Subway, coffee shops where the business owns the property, warehouses, childcare centres or office space.
ATO rules for commercial property are different from those that apply to residential real estate
One of the various implications is that older commercial properties tend to generate more depreciation than new residential properties. This is due to the fact that commercial properties generally contain more plant assets. This is just one of hundreds of factors that feed into the calculation of a depreciation schedule. As expert quantity surveyors in our team, we are able to assess and accurately account for your assets to maximise your tax depreciation in compliance with the ATO.
Case Study – Retail food franchise business
Asset management
As a business owner, one of the big decisions is deciding when to replace assets such as kitchen equipment, desks, carpet etc. A depreciation schedule showing you how much your commercial property is still worth after years of depreciation can help to inform you of when to replace and write off the old asset in a single year while benefiting from the higher depreciation available with a new asset.
Diminishing value method of depreciation was selected by this client’s accountant after understanding the business plans. Be sure to consult yours
Turnaround time to receive a depreciation schedule: from 7 business days
Tax savings over 10 years: $89,194