Back in April we covered an article on commercial property depreciation and what it could mean for you as a property owner.
Viranda wants to ensure its clients are achieving their full depreciation entitlements for the 2020/21 tax year and have sought the advice of depreciation specialists, Valuit, who can provide a detailed report outlining the tax saving opportunities.
Please consider the following:
- Nearly everything in a commercial building can be depreciated, apart from the ‘building core’ (building frame, floors, external walls, cladding, windows, external doors, internal stairways, roof and load-bearing structures). Everything else can be depreciated. The potential savings for a new building owner are extensive.
- Depreciation is based on the purchase price paid for a property which is split into three components: 1) land (not depreciable) 2) building structure (now depreciable at 2% per year) and 3) ‘fit out’ which is depreciable at various rates depending on the type of fit out.
- We recommend getting a depreciation specialist to complete an apportionment report right after the acquisition of a property. Work completed to a building after a purchase is ‘capital improvement’ and treated differently by accountants and the IRD.
The bottom line is there is money to be saved in taxes for most commercial property owners simply by having a depreciation report completed. If you would like a quote for this service, Viranda can arrange on your behalf. The cost of a report is generally based on the size and type of building (e.g. industrial, office and so on).
We are keen to get the savings back in your pocket! Talk to us today.