Real Property Matters specialty is valuing and depreciating investment properties, our aim is to maximise your return. Once the value of the item and its depreciation life is established, the ATO allow the property investor to depreciate these items using different methods to fit their investment strategy;

Real Property Matters provides all three options with graphs to assist your decision;

1. Prime Cost
2. Diminishing Value
3. Diminishing Value with Low Value Pooling

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Prime Cost Method
This method suits investors looking to hold the property in a long term investment plan as it provides consistent claims from year to year. It is structured so the claims are lower in the earlier years compared to other methods, yet you will still claim the full value over time.

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Diminishing Value Method
This method suits investors with a short term investment plan, typically around 5 years or less. The claims will diminish each year, with a larger claim being portioned in the earlier years. The full value is still claimed over time however, it will put more money in your pocket sooner.

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Diminishing Value with Low Value Pooling
In addition to the Diminishing Value Method, a Low Value Pool can be created to claim even more money sooner for those with a short term investment plan. There are two types of assets that can be allocated into a Low Value Pool to increase the property investors return, namely a Low-Cost Asset and a Low-Value Asset.

Low-cost assets are items (chattels) that have an opening value of $1,000 or less at the commencement of the Tax Depreciation Schedule. This includes items that are purchased and installed in subsequent years. In the first year, the item will depreciate at a rate of 18.75% and ever year thereafter, it will depreciate at a rate of 37.5%.

Low-value assets are items (chattels) that you claim with an opening value of greater than $1,000 and in subsequent years have depreciated to reduce their value below 148,000. When the opening value for the financial year is below $1,000 the item will be allocated to the Low Value Pool and depreciate at a rate of 37.5%.

For example, carpet valued at $1,200 would have depreciated by $240 after the first year. The remaining value at the beginning of the following financial year would have reduced to less than $1000, making it eligible to be allocated to the Low Value Pool.