How to Claim the Depreciation of a Fitout for Tax Purposes

How to Claim the Depreciation of a Fitout for Tax Purposes

Did you know that both owners and tenants can benefit from the depreciation of a property? It’s something too many commercial property owners haven’t even considered, but it’s worth knowing about for tax purposes.

It’s always important for commercial property owners to take advantage of depreciation deductions. These deductions can be quite lucrative and make a significant difference to a commercial property owner’s cash flow.

So how do you go about working out and claiming the depreciation of a fitout?

Our friends at BMT Tax Deduction have put together some valuable information to share with you about depreciation of your commercial property and how it can benefit you. To fully realise these benefits, a number of steps are involved in the process.

Quantity Surveyor

To discover what depreciation deductions are available, the owner should contact a specialist Quantity Surveyor. A Quantity Surveyor is responsible for calculating the quantity of materials needed for building work and the costs associated with these materials.

Depreciation Schedule

When speaking with a Quantity Surveyor, ask them to provide a comprehensive depreciation schedule. Part of the process of completing a depreciation schedule is a detailed site inspection. A depreciation expert will take measurements, detailed notes and photographs to ensure the owner receives the maximum claim for the wear and tear of both the building and the assets it contains.

Benefits for Both Owners and Tenants

An inspection is even more vital when a commercial property owner leases their building to a tenant who may also install a fitout to appropriate it with all they need to start their business. This is because in this situation, both the owner and the tenant can simultaneously claim depreciation deductions.

The owner can claim deductions for the building structure and any original plant and equipment assets, while the tenant can claim depreciation for any fitout works they carry out once their lease starts.

Some lease conditions sometimes mandate that tenants return a property to its original state, which could mean the tenant can claim any remaining deductions for the cost of items they remove and scrap when they vacate the property.

A Special Reduced Fee for Future Fitout Clients

As a client of Future Fitouts, BMT Tax Depreciation will provide a special reduced fee when you order a depreciation schedule. You can speak with a member of the BMT Tax Depreciation team directly on 1300 728 726 to find out more.

If you’d like to learn more about maximising depreciation deductions, visit the BMT Tax Depreciation Commercial Property Depreciation page.