Depreciation yearly claim

[SueA]

Hi
Thank you everyone for all the info you share, has helped us on our ip purchases greatly. My question is about claiming depreciation amounts from schedule. What exactly off the schedule are you supposed to claim. eg.
Division 40 has Effective Life Plant 2540, Pooled Plant 1579, Total Div 40 4119.
Division 43 = 2863. Total 6982 . This is for Oct13 to June 30 2014. I would have assumed accountant would claim Div 40 and Div 43 totals of 6982. Just checking this years tax papers that have come back from accountant , and this particular property claimed only Effective Life Plant 2540 and nothing else.
Of 4 properties some claim Total Div 40 and some ELP, one claims full totals as per the schedule. Very confused, haven't heard back from accountant yet, so hoping someone can shed some light.
Thank you

 

[depreciator]

If there was only one property and the accountant had elected to not claim anything on the building (Div 43) there might be a reason.
But if there are four properties and no consistency between what is and isn't being claimed, it's a bit of a mystery.

 

[Paul@PFI]

Hi
Thank you everyone for all the info you share, has helped us on our ip purchases greatly. My question is about claiming depreciation amounts from schedule. What exactly off the schedule are you supposed to claim. eg.
Division 40 has Effective Life Plant 2540, Pooled Plant 1579, Total Div 40 4119.
Division 43 = 2863. Total 6982 . This is for Oct13 to June 30 2014. I would have assumed accountant would claim Div 40 and Div 43 totals of 6982. Just checking this years tax papers that have come back from accountant , and this particular property claimed only Effective Life Plant 2540 and nothing else.
Of 4 properties some claim Total Div 40 and some ELP, one claims full totals as per the schedule. Very confused, haven't heard back from accountant yet, so hoping someone can shed some light.
Thank you

You assume correctly. I see heaps of this. One a new SS client LY they missed years of deductions. I was able to amend.
- Who was doing the return - Some kid ?
- Who supervises / reviews ? Nobody it seems

Its a worry when they cant enter two numbers from a report you paid for and its in English.

 

[Paul@PFI]

If there was only one property and the accountant had elected to not claim anything on the building (Div 43) there might be a reason.

That's also a worry. For CGT purposes you cant choose to claim Div 43 and avoid the CGT add-back. If you have the schedule and don't claim you still must adjust the cost base ! There is an anomaly in the CGT rules which describes the cost base adjustment as "could have claimed"......rather than "did claim"".

IMO if you have a schedule then claim it all subject to available for rent.
IMO use DV rather than PC method as it brings forward deductions. (Once you use PC you cant change back either)
IMO get a schedule even if it has $20 of deductions. You wont question if you did right thing.

 

[SueA]

Thanks Depreciator and Paul, Accountant replied that depreciation rules had changed since first ip in 2010, that one was claimed all correctly. 3 others claimed Effective plant life and rest of pooled claimed at D6, however some of these figures never made it to D6. The Div 43 amount of 2863 in above example got lost also. Oh and the borrowing costs for 1st left out as well. Lucky I didn't just sign and send as I found $ 5301 in unclaimed deductions. Don't get me started on how a semi trailer we sold in 2012 has popped back into this years business tax papers as well. She signs as an accountant, it is apparently checked by another and signed off by principal. Always find an error, usually more obvious ones, last year was $7000 in truck tyres. Time to find a new accountant I think.

 

[Paul@PFI]

Sue - You described the problem. The work was performed by unqualified staff. Anyone can call themselves an accountant. Even a mechanic can. Its not a regulated word at present. It relies on a review and obviously that isn't working.

Things do get missed and software fails do happen. But self review, partner review etc should pick up that. I do all my own work. I see things a junior will never think of.

You should be seeking a tax person who THINKS and gives advice. Throwing numbers into the return is simple. Its finding strategies etc where the value add is.