Tools under $200, depreciation

[NSWinvester]

Hi,

We're doing renovations right now and I needed to purchase some tools, for tools under $300 (lower value pool) are they immediate write offs?

 

[pennyk]

I think so. At our work, the limit is $500.

 

[Ace in the Hole]

But wouldn't this only apply if it's your principle business?

Otherwise, any part time property investor doing a reno can run up up bill of $10,000 worth of small tools < $200 and use them for other purposes after the reno is finished.

 

[depreciator]

Depreciation is compensation for wear and tear on Assets that produce an income. So you can only depreciate tools used for an IP reno if the tools remain at the property and are available for use by the tenants, which probably wouldn't be a great idea.

 

[skater]

Depreciation is compensation for wear and tear on Assets that produce an income. So you can only depreciate tools used for an IP reno if the tools remain at the property and are available for use by the tenants, which probably wouldn't be a great idea.

I claim some tools, however the stuff that I claim is used for multiple IPs. For instance, say I am painting a property and I buy new paintbrushes, trays, rollers etc. This is stuff we use all the time in our Property Investment Business. Outside our IP's we really don't have a lot of use for it with the exception of when we first purchased & painted our PPOR, which from memory we bought new stuff (not deductible) to do that with and then it just remained with the other IP stuff.

I suppose you would really have to see what the intention was when purchasing and if you were running a Property Investment Business, or you just have the one IP and the stuff you want to claim is more than likely going to be used for personal purposes.