Depreciation Schedule

Definition

A depreciation schedule is a detailed report prepared by a qualified quantity surveyor that lists all the items in a rental property eligible for tax depreciation claims. It covers both Division 40 (plant and equipment — carpets, blinds, appliances, hot water systems) and Division 43 (capital works — the building structure itself). A single schedule typically costs $400–$800 and lasts the life of the property.

The average depreciation schedule finds $5,000–$15,000 in first-year deductions. Over the life of a property, deductions can total $100,000+. The cost of the schedule itself is also tax deductible. Not having one is the single most common reason investors over-pay tax on rental properties.

You buy a 2015-built apartment for $550,000. A quantity surveyor prepares a depreciation schedule for $660 (tax deductible). In year one, it identifies $4,200 in Div 40 deductions and $8,000 in Div 43 deductions — $12,200 total, saving you $4,514 in tax (at 37%).

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