Depreciation report helpful after renovation or new build?

I have another depreciation question.

The double block we are hoping to get DA for four townhouses holds two old queenslanders. At time of each purchase (15 and 8 years ago) they were very run down and we ripped out everything (bathrooms, kitchens, carpets, curtains etc). Everything we ripped out was knackered, probably 50 years old and we were left with a shell. We put in new kitchen in one, new bathroom in the other, had floors polished, added curtains. Nothing really of great cost or value like you would find to depreciate in a modern new-build.

If we get approval to build townhouses, we will need to lift and shift both houses. We will raise and slide them but not build under at this stage. We would not need to do anything to kitchens or bathrooms immediately and would look to reconnect services, batten out the downstairs and re-rent whilst we build in the middle block.

Assuming the townhouses go ahead and we end up with four brand new townhouses, would we need depreciation reports? I guess we would use the build cost figures instead?

Also assuming we decide to enclose the downstairs of the older houses, add another bathroom to each house, and maybe update both kitchens and existing bathrooms, would it then be worthwhile having a depreciation schedule done? Or would we use the build prices for the new kitchens and bathrooms as our cost base?

I'm more than happy to get a depreciation schedule on the old houses and the new townhouses, but am I right in thinking that because we are doing the building and the renovating, we have the figures we need anyway?
 
Be guided by your accountant, Wylie.
Keep detailed records of all money spent and ask them whether they would like you to get Dep Schedules or whether they are happy to use your costs. I talk to lots of accountants and some, even when given costs, want a third party to produce a Dep Schedule because they reckon it would take them too long. Others are happy to do it.
 
Be guided by your accountant, Wylie.

Seconded, as long as your accountant as decent experience with property taxation. Some out there still give bad advice (e.g., that you can't depreciate a pre-1987 property).

Keep detailed records of all money spent and ask them whether they would like you to get Dep Schedules or whether they are happy to use your costs. I talk to lots of accountants and some, even when given costs, want a third party to produce a Dep Schedule because they reckon it would take them too long. Others are happy to do it.

Seconded again but it's worth keeping in mind that, even with all available costs, your accountant will have to work out which are depreciable, which are Div 43 and Div 40 (not always obvious), the effective lives of each Div 40 item, work out both prime cost and diminishing value methods (or at least decide in advance which will suit you) and, if you're using the latter method, do some extra maths for the low value pool. It's not a small task and it's a rare accountant who will do this for free. There could also be complications should you change accountants.
 
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