🏠 Think Older Properties Can’t Be Claimed? Think Again.
Many investors believe that older properties don’t qualify for tax depreciation—especially those built before 1987. But that’s one of the most common and costly misconceptions in property investing. The truth is, even older homes may contain significant deductible value—especially if renovations or upgrades have been done.
If you own an older rental, this guide will show you how to unlock deductions you may not even know exist.
🔍 Why Depreciation Still Applies to Older Properties
Tax depreciation allows you to claim a deduction for the wear and tear of a property over time. While Division 43 (capital works) generally applies to buildings constructed after 1987, any renovations or structural improvements made after that date can be claimed—even if you didn’t do them yourself.
That means:
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A 1970s house with a 2010 kitchen still qualifies
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A pre-1985 unit with a new roof, bathroom or extension may contain claimable works
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Many inherited or purchased second-hand properties include thousands in missed deductions
🛠️ Division 43 – Capital Works
Capital works deductions apply to the building’s structure and improvements—things like:
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Brickwork, tiling, roofing
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Driveways, retaining walls, fencing
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Structural additions like decks or garages
Even if the original build doesn’t qualify, improvements made after 15 September 1987 are claimable, provided construction dates can be verified.
🔧 Division 40 – Plant & Equipment
For second-hand residential properties purchased after 9 May 2017, you can’t claim previously used Division 40 items (e.g. blinds, ovens, carpets). But if you add new assets yourself, or it’s a commercial or newly built property, those assets can be claimed.
💼 Example: How This Helped a Real Investor
Investor Profile:
Claire purchased a 1975-built brick home in Newcastle as a rental. Her accountant told her depreciation likely wasn’t worth it due to the age.
What We Found:
Our team identified over $70,000 in qualifying improvements, including:
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Kitchen renovation in 2008
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Roof replacement in 2015
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Bathroom and laundry fit-out in 2021
The Outcome:
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$3,900 in deductions in Year 1
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$17,200 over five years
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Resulted in an extra $62/week in after-tax income
📋 Do You Need a Report?
Yes. To claim depreciation, the ATO requires a schedule prepared by a qualified Quantity Surveyor. At TaxShield, our reports are:
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Fully ATO-compliant
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Backed by Chartered Quantity Surveyors
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Built using real construction cost estimates—not guesswork
🧾 Summary
Don’t let the age of your investment property stop you from claiming what you’re entitled to. Whether your property has been recently updated or had past improvements, a depreciation schedule could uncover thousands in deductions.
✅ Ready to Claim?
Order our Investor Starter Package for just $395+GST and discover how much cash flow is hidden in your older investment property.
