Looking for a reccomended quantity surveyor...

[syba]

Question guys...

I'm about to lease out my PPOR, it's about 1 year old.

Do I need quantity surveyor just before the lease start?

What do they do actually? Is it true that with their report we can maximise our tax return?

Do I need them to survey my IP every year?

Thanks

You can get a quantity surveyor in whenever you want really, but a your depreciation starts when you purchase the property and not just when you start renting it out, it's best to get them in around when you buy it. They need to assess the age and wear/tear of the depreciable items at the time you bought it and its easier to do that early on.

Essentially, your first year depreciation won't be claimable as it was your PPOR. However a competant Quantity Surveyor should be able to minimise your deductions in that first year so you don't miss out on too much (eg, not claim any low cost items at 100% and start the low value pool when the property becomes an IP).

Yes - a QS can truely maximise your tax returns with depreciation. Is well worth the fee (which is also tax deductable).

No they don't need to 'survey' your property every year. The report should last a while, and any improvements you make to the property can usually just be added by your accountant (for things like install blinds, replace hot water system, etc). If you do something big like an extension, etc then you would want a QS to have a look at that. You may also need to speak to your QS if a new ruling comes out that may affect depreciation claimable. However there hasn't been anything for a while, and if something does happen of significance, there will be plenty of media coverage about it so you should find out (unless you live under a rock).

Hope this helps...

 

[letitbe]

... Essentially, your first year depreciation won't be claimable as it was your PPOR. However a competant Quantity Surveyor should be able to minimise your deductions in that first year so you don't miss out on too much (eg, not claim any low cost items at 100% and start the low value pool when the property becomes an IP)....

Thanks for the tips, Syba. Just talked to the guy at depreciator, he told me they will pro rata the depreciation into 20 years time. Is it a correct way? I try to explain that some items depreciate faster than the others but he seems doesn't understand.

 

[syba]

You pro-rata the first year of ownership based on the part of the year you own it. You can also pro-rata the year when the property was part IP and not an IP. You don't pro-rata over 20 years. I suspect you may have misunderstood Depreciator?? Maybe they give you a report for 20years? Perhaps Scott can comment?

And yes, different assets depreciate at different rates (they have different effective lives).

 

[letitbe]

You pro-rata the first year of ownership based on the part of the year you own it. You can also pro-rata the year when the property was part IP and not an IP. You don't pro-rata over 20 years. I suspect you may have misunderstood Depreciator?? Maybe they give you a report for 20years? Perhaps Scott can comment?

And yes, different assets depreciate at different rates (they have different effective lives).

Thanks again Syba, it is not clear to me, I might misunderstood his words. Yes, the report is for 20 years. Is the report easy to understand, does it show how much total depreciation for second year (in my case) and the following years?

 

[depreciator]

Just talked to the guy at depreciator, he told me they will pro rata the depreciation into 20 years time. Is it a correct way? I try to explain that some items depreciate faster than the others but he seems doesn't understand.

Not sure who you spoke to here, by I have a pretty good idea which person in that conversation may have misunderstood things.

There is no set format or length for a Depreciation Schedule. Some run for 1 year. Ours are 20 years. There are some that are 'lifetime schedules', which always make me smile.

Some of the Schedules I see I can't quite understand.

We try to make ours as easy to understand as possible. Syba is pretty sensible, so I'm betting his are easy to understand also.

We set out the depreciation claimable for 20 years. For the last 10 years or so of most Schedules it is often only the building that is depreciated. The Assets are usually written-off.

All Depreciation Schedules are supposed to offer the Prime Cost and Diminishing Value methods as options - it is up to the taxpayer to choose which method they use.

Assets (fixtures and fittings) are written down more quickly with the DV method so there is more depreciation in the early years. The Low Value Pool option speeds things up even more.