The most notable gain of property investment depreciation to you as an investor is its ability to assist in saving significantly on your upcoming (and later) income tax returns.
Like a rental property owner, here are just a few reasons that John Sage notes as to why you should use a depreciation schedule:
- You can decrease your taxable income by doing the following: Property investment depreciation means deducting the wear and tear and loss in value of the rental property from your taxes. With a suitable schedule, you can lower the tax you must pay.
- You can claim legitimate tax deductions for the investment property: the only legal option to claim the loss in value of the rental property’s structure is to use a depreciation schedule, which allows you to maximize your potential savings while protecting your rental returns.
- You can pay less tax even if the property has been refurbished: By working with such a quantity surveyor, one can maximize your possible tax savings from property investment depreciation (even though the previous owner has restored the property).