The details
- The existing four bedroom, two bathroom house was purchased in 2016 for $750,000. The property was constructed and completed in 2015 on 400 square meters of land
- The property was rented for $585 per week or $28,080 per annum
- Expenses totalled $30,455 including minor works, agent fees, maintenance and interest
- Total tax depreciation on the property amounted to $15,251
By contacting Acumentis for a Tax Depreciation Assessment, the owner discovered the ability to maximise tax benefits and improve cash flows with a tax depreciation schedule. This resulted in a tax depreciation claim of $15,251 in year one, reducing the total annual cost of the investment property by $5,948, a benefit of $496 per annum.
| No Tax Depreciation Claim Applied | Tax Depreciation Claim $15,251 Applied | ||
| Total Annual Income: ($2,340 p/m) | $28,080 | Total Annual Income: ($2,340 p/m) | $28,080 |
| Total Annual Expenses: (p/a) | ($30,455) | Total Annual Expenses: (p/a) | ($30,455) |
| Cash Income minus Expenses: | ($2,375) | Cash Income minus Expenses | ($2,375) |
| Tax Depreciation Claimed: | $ – | Tax Depreciation Claimed: | ($15,251) |
| Pre-Tax Loss: | ($2,375) | Pre-Tax Loss: | ($17,626) |
| Tax Refund (@39%): | $926 | Tax Refund (@39%): | $6,874 |
| Net Annual Cash Position: | ($1,449) | Net Annual Cash Position: | $4,499 |
| Monthly After Tax Cash Position | ($121) | Monthly After Tax Cash Position | $375 |
| The additional tax benefit per month amounts to $496 ($5,948 p/a) |
Disclaimer: The tax depreciation amount within this case study relates to the first year claim and will vary depending on the method and asset allocations considered for tax depreciation. It will be different for each case and assessed on the business infrastructure, equipment/chattels and capital expenditure on the property recently