Depreciation Schedule: Why Investors Order One Day One

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A depreciation schedule is a quantity surveyor’s report listing all the depreciable assets in your investment property and their decline-in-value over time. The cost is $500–700 — and it pays for itself in year one for most investors.

What You Can Depreciate

Capital Works (Division 43):

The building itself
2.5% per year over 40 years for residential built after September 1987
Renovations and structural additions

Plant & Equipment (Division 40):

Carpets, blinds, appliances, hot water systems, air conditioners
Depreciated at various rates (5–20% per year depending on asset type)

Tax Savings in Year One

Example: A $550,000 property built in 2010

Building depreciation (2.5% × original construction cost): ~$5,000/year
Plant & equipment depreciation (varies by inclusions): $3,000–$8,000 in year one

Total deductions: $8,000–13,000/year

In the 37% tax bracket: $2,960–4,810 saved per year.

Spread over 5–10 years and the savings dwarf the upfront fee.

The 2017 Rule Change

For properties acquired after May 2017, plant & equipment depreciation only applies to items you bought new (not items already in the property).

This affects how you should approach renovations:

Replace older appliances/AC/carpets early → you depreciate them
Use cosmetic items rather than the bare-bones strategy

How to Order

Engage a registered quantity surveyor (not your real estate agent)
They visit the property within 2–4 weeks of settlement
Report delivered in PDF, listing each item and depreciation schedule
Hand to your accountant; deductions auto-apply yearly

Top providers: BMT, Washington Brown, Capital Claims, Depreciator. Prices similar ($600–700).

What If You Already Bought (No Schedule Yet)?

You can still order one mid-tenure. The schedule works retroactively for the current and future tax years — and you can amend up to 2 prior returns to claim missed deductions.

Costs You Might Forget

Tax-deductible as part of holding investment property:

Loan interest
Council rates and water charges
Property management fees
Repairs and maintenance
Insurance (building + landlord)
Travel to inspect (limited rules)
Depreciation (the big one)

Many first-time investors miss 30%+ of available deductions in year one.

Special Case: New Builds

A new build property comes with the most depreciation. Investors targeting cash flow specifically buy new for this reason.

💡 Pro Tip: Don’t wait for tax time to order. Earlier = more time to claim in year one.