ATO TR 97/25 (capital works + plant & equipment) · 30–54 pp typical

Depreciation Schedule Report Explained — Plain-English Analysis (Australia)

A depreciation schedule is the single highest-leverage piece of paperwork most investment-property owners never read. Prepared by a qualified quantity surveyor under ATO TR 97/25, it lists every eligible deduction - Division 43 capital works (structure, brick, roof) and Division 40 plant and equipment (carpet, oven, hot-water system) - that you can claim against income. A typical schedule delivers $5,000–$15,000 of year-one deductions on a modern property. We pull every line item out, group them by division, flag the low-value pool opportunity, and show the cumulative deduction over 10 years so you can see exactly what the paperwork is worth.

Analyse my depreciation schedule report View sample

What the report actually tells you

What’s in a depreciation schedule report, plainly.

Under TR 97/25 and Division 43 of ITAA 1997, structural elements of a residential rental built after 18 July 1985 can be depreciated at 2.5% per year over 40 years. Plant and equipment (Division 40) depreciates at per-asset effective-life rates set by the Commissioner - ovens, carpets, blinds, hot-water systems each have their own schedule. Post-2017 amendments restricted plant-and-equipment claims for second-hand residential assets; only new items and assets installed by the current owner qualify. A qualified QS report quantifies every claim. Our analysis extracts and summarises the whole schedule so you can brief your accountant at BAS time without re-reading 50 pages.

Common findings & what they cost

What we see in a depreciation schedule report — with AUD ranges.

These are the five most common finding types we extract from depreciation schedule reports, in descending severity. Each line is what the inspector flagged (in their words), translated into buyer-relevant English, and costed against current Australian trade rates.

High-value Div 43 capital works base: $326,400 @ 2.5% = $8,160/yr for 40 years. $8,160/yr

High-value Div 40 plant & equipment: 42 items, first-year deduction $4,820. $4,820 yr1

Medium Low-value pool candidates: 14 items under $1,000 - accelerated write-off. $2,100 yr1 accel

Medium Previous owner’s plant & equipment excluded per 2017 amendment; new purchases eligible. tracked

Low Legal & inspection fees from acquisition: potentially deductible separately. accountant

Negotiation · buyer’s checklist

Red flags & the questions to ask.

Red flags that usually kill a deal

No depreciation schedule on a post-1985 investment property - you’re missing thousands per year
Schedule more than 5 years old with no updates after renovation works
Second-hand plant and equipment claimed in contravention of 2017 amendment (hello, ATO letter)
Mixed-use property (home office, holiday let) without apportionment worked in

Questions to ask your vendor / agent / strata manager

Is the schedule prepared by a registered Tax Agent or AIQS member?
Has the low-value pool threshold (< $1,000) been applied and tracked?
Have any renovations since the purchase been added via a supplementary schedule?
Does the schedule apportion correctly for periods where the property was not income-producing?

How ReportWise analyses this

Five passes. One engine. Depreciation Schedule reports included.

Your depreciation schedule report runs through the same five-pass pipeline as every other type we analyse: extract (OCR + structured parsing), classify (severity tagging against ATO TR 97/25 (capital works + plant & equipment)), cost (AUD ranges against current Australian trade rates), translate (jargon to plain English), and validate (cross-check against the original so nothing is fabricated or omitted). Standard tier delivers in under sixty minutes; Premium tier in under thirty minutes or fifty percent refunded. Read the full method or compare tiers.

FAQ · Depreciation Schedule reports

Answers we give every week.

Q.01What’s the difference between Division 40 and Division 43?

Division 43 covers the capital works - the structure, brickwork, roof, fixed tiling, permanent cabinetry. It depreciates at 2.5% per year straight-line over 40 years. Division 40 covers plant and equipment - movable or replaceable items like carpet, ovens, hot-water systems, blinds. It depreciates per-asset at ATO effective-life rates, often much faster than 2.5%.

Q.02Can I claim depreciation on a second-hand property?

Division 43 capital works: yes, as long as construction is post-18 July 1985. Division 40 plant and equipment: only for new assets, or assets purchased and installed by the current owner post-2017. Second-hand plant is explicitly excluded for residential rentals per the 2017 amendments.

Q.03Is a depreciation schedule worth it on an older property?

Usually, yes - even pre-1985 properties have eligible plant and equipment (hot-water systems, ovens, carpet) and any post-1985 renovation is fully claimable as capital works. A good QS will estimate first-year deduction before quoting the schedule so you can see the ROI.