Adjusting QS Report Values

[Owen]

When I bought an apartment last year I got a quantity survey report done immediately and then ripped everything out and renovated it. Using the original QS report I scrapped the remaining value of the items I replaced during the reno (ie oven, carpet etc.) in my 2001-2002 tax return. Now I need to get this report updated with the new values for the items I replaced for this years tax return and future depreciation.

My question is how do other people doing this get the quantity surveyor to estimate the value of the new items rather than taking actual costs?

It is often told here and other places how a cheap stainless steel oven can be valued like a European one or how changing the light switches can be valued as a building rewiring but the first question he is going to ask is where are the receipts!!! I don’t think he will be that stupid as to not think I have any. If I am going to use my receipt values then my accountant can adjust the original QS report and I won’t worry about getting another survey done.

Any experience of doing this out there?

Thanks

 

[Jas]

OS: "Where are the recipts?"
You: "I lost them"

QS undervalues an item
You: "How lucky, I found that recipt"
QS adjusts value of item

you know what you're doing and so do they, so don't worry.

Jas

 

[TheBacon]

Is there a way around this?

What if the constructed VALUE of your additions/ renovations / whatever can be shown to be more than the actual COST. For example you buy the components for a new kitchen at a cheap price, make some modifications and fit them to your house. In effect you have installed a custom kitchen into your house. Likewise with a bathroom, what if you made a new vanity? Costs may come to say $200 but if the vanity can be shown to be WORTH $500, can this higher value be used?

Can you get an item insured for a certain value? Would this be enough to show the accepted market price for it?

There must be a way to have the true VALUE of an item used not the cash COST.

I remember when I thought laws and taxes where black and white, right or wrong….

TheBacon

 

[WillG]

QS's tend to work on the installed price of items. That can often increase the value quite a bit. Tradesmen may forget to give you a written receipt on the spot and promise to send it later on - perfectly valid.

The QS should know what he can and can't get away with if you are audited.

 

[Lotana]

Hey, you can only claim what you spent! How about this dialogue:

QS: Do you have your receipts?
You: No, I've lost them

ATO: Who did you buy this oven from? It is valued at $2000 in your depreciation schedule.
You: Don't remember

ATO: Who installed it?
You: Don't remember

ATO: We disallow this deduction and you have the right to take us to court.
You: ?

Cheers,
Lotana

 

[Puppeteer]

Do you have to get a quantity surveyor to value the fitting etc, or is it good enough to have an agreed value on the offer/acceptance.

Also, of you have receipts for the original goods, do you still need to get a QS in to value the fittings?

Thanks in advance

The Puppeteer

 

[TheBacon]

Lotana,
please dont misunderstand the point of my question. I'm not suggesting anything dodgy, illegal, improper, unethical etc., etc....

My question is... Can you value an item for depreciation at ACTUAL value as seen in the house, not cost of materials?

If one cannot, and there is only, say, a 20% difference between doing it yourself (eg a kitchen) and getting it installed, one would most likely get most of this difference back in the 1st yr in depreciation, yes?

It is worth considereing as on one had you save cash right now, while on the other you save time and end up with the same financial outcome.

What if.....
You held the property in a trust and contracted yourself to install the kitchen? You claim full dep costs, + you make a profit on the products and installation.....

Dreams, schemes and the ravings of a madman...

TheBacon

 

[Owen]

Thanks for the replies so far. I agree with both Jas and Lotana. Technically, Lotana is correct but I have read a lot of anecdotal evidence of Jas' point of view. Does it work?

Did those of you that have done this use different surveyors for the before and after reports? I’m only interested in revaluing a number of the items in the original report so a new report from a different company is overkill. Therefore, a revalue from the original company is likely so I’m concerned about ‘lost’ receipts idea working. But I wish to maximise my depreciation all the same. Who out there has successfully ‘lost’ there receipts and got the QS report they wanted?

 

[Jas]

Originally posted by Lotana
Hey, you can only claim what you spent! How about this dialogue:

QS: Do you have your receipts?
You: No, I've lost them

ATO: Who did you buy this oven from? It is valued at $2000 in your depreciation schedule.
You: Don't remember

ATO: Who installed it?
You: Don't remember

ATO: We disallow this deduction and you have the right to take us to court.
You: ?

Cheers,
Lotana

You: But 2000 is what your approved QS set the value at.
ATO: Oh, ok. Onto the next item

Jas