Maximise Your Commercial Property Investment Returns Beyond Depreciation: A Must-Read for Funds Managers, Property Owners and Landlords!

Dear Property Investors,

Are you confident that you're maximising your property investment returns simply by claiming your usual depreciation deductions? If your answer is yes, think again. While claiming depreciation is an essential part of reducing your taxable income, it’s just the beginning. There are several additional strategies that can significantly boost your returns as a commercial property owner or landlord. Let’s dive deeper into how you can take full advantage of available tax benefits.

1. Leverage Your Asset Register

An asset register is more than just a list of what you own. It's a powerful tool that records every asset within your property, from large-scale items like HVAC systems to smaller items like office furniture. Keeping a detailed asset register ensures that every depreciable asset is accounted for, which helps maximise deductions.

How It Benefits You:

• Enhanced Accuracy: Ensure every asset is depreciated correctly and on time, maximising your tax deductions.
• Improved Decision-Making: Identify which assets are due for replacement or write-off, optimising your investment strategy.
• Audit Compliance: Maintain robust records to back up your depreciation claims during tax audits, protecting you from compliance issues.

2. Update Your Capex (Capital Expenditure) Regularly

Keeping your capital expenditure records up-to-date is essential for effective tax planning. Regularly reviewing your capex can help you identify new opportunities for tax deductions and better manage your investment budget.

How It Benefits You:

• Strategic Spending: Plan your capital investments around tax benefits, optimising your deductions and overall returns.
• Improved Cash Flow: Timing your capex to coincide with tax incentives can boost your cash flow, allowing for reinvestment into your property.
• Enhanced Property Value: Invest in upgrades that not only attract better tenants but also qualify for tax write-offs.

3. Utilise Write-Off Allowances

Write-off allowances can provide immediate tax relief by allowing you to deduct the cost of specific assets immediately rather than depreciating them over time. This is especially valuable for commercial property owners with frequent updates or replacements of smaller assets.

How It Benefits You:

• Immediate Deductions: Reduce your taxable income in the current year, boosting your bottom line.
• Improved Cash Flow: Reap the benefits of tax savings immediately, enhancing your ability to invest further.

4. Take Advantage of Instant Asset Write-Offs up to $20,000

One of the most valuable tax incentives available to commercial property owners and landlords is the instant asset write-off. This incentive allows you to immediately deduct the cost of eligible business assets costing less than $20,000 each in the year you purchase them, rather than spreading the deduction over several years through depreciation. This includes a wide range of assets such as office equipment, tools, and other property improvements.

How It Benefits You:

• Immediate Tax Savings: Claiming the full cost of assets up to $20,000 instantly reduces your taxable income in the year of purchase, providing substantial tax savings.
• Improved Cash Flow: By lowering your tax bill upfront, you retain more cash to reinvest into your business or property, enhancing overall cash flow.
• Flexible Investment: Enables you to make strategic purchases without the long wait for tax benefits, allowing for quick upgrades to keep your property competitive.

Maximise Your Returns: Act Now!

Don’t leave money on the table. By implementing an asset register, regularly updating your capex, utilising write-off allowances, and exploring all available tax incentives, you can take your property investment strategy to the next level. Let us help you navigate these opportunities to ensure you’re fully maximising your investment returns.

Contact Patrick Chu ?? TDQS - Tax Depreciation & Quantity Surveyors today for a free personalised consultation on optimising your property investment strategy!