If you own an investment property, and want to take advantage of the significant tax savings of claiming depreciation, you'll need to hire a quantity surveyor. As per the ATO Tax Ruling 97/25, if you own any investment property built after 1985, and/or if the construction costs are unknown, you must hire a quantity surveyor to develop a depreciation schedule in order to make a depreciation claim. This work cannot be done by your accountant.
Why a Quantity Surveyor
These professionals are experts in the economics of construction. They are equipped with the experience and education to accurately measure the construction costs of your property and help you maximise your deductions. Your accountant can give you tax depreciation advice, but only a quantity surveyor can provide you with actual figures with which to base your tax return.
A qualified quantity surveyor must be accredited by the Australian Institute of Quantity Surveyors (AIQS), and must also be registered as a tax agent. Together, these two qualifications allow a professional to prepare a depreciation schedule for you. It may seem like common sense, but it bears giving a reminder – make sure that the professional you hire has these important qualifications. If not, your tax return may not be accepted by the authorities.
Duties of a Quantity Surveyor
Once you're ready to devise a depreciation schedule, the first step is an inspection by the surveyor. Once onsite, they will:
- Inspect the property and boundaries
- Photograph, measure and document all depreciable items located on/in the property
- Calculate the building's construction costs
- Calculate the value of the equipment on the property, such as floors, blinds and appliances
Once the quantity surveyors has compiled all of the data, he or she will create a comprehensive report that will detail the breakdown of all building allowance costs, all equipment costs, along with the depreciation rates, and length of time that you are allowed to claim that depreciation. Simply give that depreciation schedule to your accountant to use on your tax returns. Your accountant will use that report to save you money on your return.
As an investor, you obviously want the most up-to-date and accurate information possible when compiling your depreciation report. Most companies offer money-back guarantees on their services, so it pays to get advice from a qualified and experienced professional. This will help keep more money in your pocket, so you can keep maximising your investment dollars.Share