2 June 2026
Not really.
It’s just changed a bit, that’s all.
And this game always changes.
Charles Darwin would have made a great property investor. He observed that it was not the strongest of the species that survives. Or the most intelligent. It was the ones most receptive to change.
We’ve been doing Depreciation Schedules for nearly 25 years and boy, we have seen some shifts in strategy.
Right now, there are investors who would have never thought about commercial property doing the numbers – we’re anticipating an uptick in requests for Depreciation Schedules on commercial properties next year.
Investors who have never thought about investing in brand new property will be pondering just that.
And people who hold older properties unaffected by the changes to negative gearing will be exploring the idea of pulling equity out of them to employ elsewhere. They will be clutching their golden goose tightly and making it work for them.
What they do need to do is make sure all changes to their properties are captured in their Depreciation Schedules given the fact that calculating CGT just got more complicated.
And of course, in the midst of all this excitement, the tax season rolls on. And the ATO sits there impassively waiting for you.
Now is the time to order a new Depreciation Schedule if you have bought another property recently. You can make an enquiry online or call our team on 1300 660 033.
Now is the time to be clear about what the ATO’s expectations are.
Now is the time to understand how to treat work you have done to your property over the last year.
Now is the time to prepare yourself for your accountant.
Key Points
- 1. It’s more important than ever to make sure you’ve captured any changes to your investment property so the changes can be factored into the cost base for CGT calculations down the track.
- 2. The ATO know a lot about you already – including property related income from short term rental platforms and rental income reported by property managers. Make sure you’re recording and reporting income generated correctly.
- 3. Repairs vs improvements – it’s important to understand the difference and treat each accordingly. Repairs can be claimed immediately – 100% write-off, while improvements get claimed slowly – 2.5% over 40 years.
- 4. Free updates to Depreciation Schedules is a service Depreciator has always offered. We did an update for one of our clients, Jon, recently and he was kind enough to share his experience with us.
- 5. Do you have a friend with an investment property who needs a Depreciation Schedule? Refer them to Depreciator using our Refer a Friend link and get rewarded with a $40 eGift Card.
Capturing changes to your investment property is more important than ever
Gee, there has been a lot written about the changes to CGT announced in the Budget. We are still getting emails about it.
So we’re not going to add to the pile-on.
Our only comment is that it has now become even more important to make sure any improvements you have made to a property you already own have been captured so they can be factored into the cost base for CGT calculations down the track.
If you are renting out the home you lived in and made changes to it while you lived there, they need to be captured.
If you make changes to a property while you rent it out, they need to be captured.
Everything you capture before July 1, 2027 could be advantageous down the track.
Aren’t you lucky that you have a Depreciation Schedule prepared by a company happy to update it endlessly – free. You can read more on how to update your Schedule here.
What does the ATO know already about your investment property?
There are still ATO clients (it’s less threatening when they call them that) who deliberate on what they will tell the ATO when they do their tax return.
It would probably save people a lot of effort if the ATO told them what they already know and just asked people to check it. We have written about this before.
The ATO have long had access to bank details and share dividends. And of course salary details.
More recently, short term rental platforms were instructed to share with the ATO payment details made to property owners – quite a few people who rented out rooms in their home and did not declare the income would have been disappointed about that.
And surprised about the possible CGT implications down the track.
Rental Bonds in various states now share property owner details with the ATO.
And most recently, the ATO went to providers of property manager software to elicit from them information on landlord payments.
The days of being circumspect with what people tell the ATO are gone. Make sure you’re keeping good records of rental income generated from any property source – and report it accurately in your tax return.
Repairs vs improvements – that old one
It’s also wise to understand the rules around repairs vs improvements.
We bang on about this a lot, but it is still the thing we are most often asked about by clients in emails and phone calls especially in June.
So we’ll bang on about it again.
Repairs can be claimed immediately – 100% write-off. While improvements get claimed slowly – 2.5% over 40 years.
It is entirely understandable that people would like to claim work as an immediate deduction and they often pitch their emails in this way and hope that we agree. Of course, it’s not really up to us. We don’t advise people, all we do is offer an opinion. But that opinion is based on a good understanding of what the ATO’s expectations are.
Most of the confusion will be cleared up if you bear these things in mind:
1. A ‘repair’ to the ATO means dealing with damage or deterioration that happened while YOU were renting out the property.
2. If the damage was there BEFORE you started to rent out the property, you have ‘improved’ the property so you claim that work at 2.5% per year.
3. Replacing an entire item like a stove, hot water heater, air con etc is NOT a repair. You need to depreciate the new item, but the good news is that those things depreciate very quickly.
Depreciator’s free update service
We have always offered free updates to our Depreciation Schedules and there are clients who come back to us every year. You can read more about this service here.
Rather than us go on again about our free update service, we thought we would post this Google review that a client very kindly wrote last week. We’ve been helping him out for 16 years, which makes him a relatively recent client:
“Depreciator has been great for managing my investment property’s tax depreciation over the past 16 years. From the very beginning, their service was professional, thorough, and great value for money. They provided a detailed and accurate depreciation schedule shortly after I completed construction, and what truly sets them apart is their ongoing support.
I’ve made several improvements to the property over the years, and each time, updating the schedule has been quick, seamless, and—remarkably—free of charge. Their team is responsive and efficient, making it easy to keep my depreciation claims current without any hassle.
Knowing that I’m maximising my deductions every year, thanks to their expertise and customer-focused approach, gives me real peace of mind. I highly recommend Depreciator to any property investor looking for a reliable, knowledgeable, and cost-effective solution. “
Refer a friend
Do you have a residential or commercial property you would like us to help you claim depreciation for? Or a question about depreciation?
Order online now or call us on 1300 660 033 and rely on our 20-plus years of experience in estimating depreciation returns.
