Cladding – Tax Deductions – Repair or Improve – ATO Determination
Recently the ATO has determined the replacement of ACC (Aluminium Composite Cladding), is in fact an improvement to your property and not a repair.
We have several clients who are now reviewing their ACC on their sites and discussing with their fire engineer a solution to rectify their property and make safe moving forward.
The ATO have clearly said these costs will be a capital improvement for the purpose of Division 43 of the ITAA 1997 (refer to the link further below).
In financial modelling, this means, if the new cladding installed cost $1m, you can depreciate this cost from completion of installation over the next 40 years (2.5%) which equates to a deduction of $25,000 per year, as an example.
An additional deduction may be allowed to write off the existing cladding, if the original cost and installation was completed after 1979 on hotels (40 year life), commercial, aged care, industrial buildings and similar construction which commenced after 16 September 1987 (2.5%). As we have qualified quantity surveyors registered on the Tax Practioners Board we can provide this deduction for you.
Below is the link from the ATO which provides some more clarity and discussion. Continue reading
Napier & Blakeley has strengthened its Asset Performance & Lifecycle Advisory services
These exciting appointments both complement and extend the capabilities of our building consultancy, due diligence and cost consultancy teams, to help clients manage and improve the performance of their property developments, assets and portfolios, adding further value throughout the property cycle.
MELBOURNE
Introducing Ian Gardner
Associate Director
m. 0488 225 569
e. igardner@napierblakeley.com
a. L13, 90 Collins Street, Melbourne VIC 3000
Ian Gardner has joined Napier & Blakeley as an Associate Director. Continue reading
