While understanding who a quantity surveyor is and the various types are vital, grasping the real reason why you need them is fundamental. As alluded to earlier, the ATO allows investors to claim the decline in value of their assets against their taxes.
The deductible amount will depend on the value and the property’s age, but generally, it ranges between 2.5% and 4% of the value of the capital works of the building. Capital works may comprise the cost of land, construction, and renovation.
Through a tax depreciation expert called a quantity surveyor, a property owner can claim these tax benefits with the help of a depreciation schedule. A depreciation schedule is a report prepared by a quantity survey firm such as Koste QS. A QS will prepare a tax depreciation schedule after purchasing or constructing a building for property tax depreciation.
One can easily quantify the benefits of a depreciation schedule to a property owner both in monetary and non-monetary terms. Since the ATO requires that building owners report on their property taxes, your tax schedule could save you an upward of $10,000 each year. Of course, you’ll also remain compliant with government requirements, thus cushioning you against constant disruptions by ATO officials due to non-compliance.
In essence, the collective cost savings amounting from a tax depreciation schedule could run into hundreds of thousands over a building’s economic life. Once a quantity surveyor prepares their report, the investor forwards it to their accountant, who then estimates the realizable tax savings.
As a side note, the cost of preparing a tax depreciation schedule is fully deductible for tax purposes. So if you’re wondering whether or not this report is worth your while, the answer is YES, IT IS. Moreover, its benefits will be felt years on after a quantity surveyor concludes their work.
Are you looking to partner with a leading quantity survey firm with decades of industry experience? Each year, Koste prepares tens of thousands of depreciation reports, cost estimates, and crucial nuggets of advice for our clients, saving them thousands while securing quality outcomes for their projects.
