Capital Allowances & Tax Depreciation

Apex leads the way in the area of tax depreciation. Our strength in this field ensures our clients attain the optimum depreciation entitlement as an offset to the decline in value of assets which make up a property.

The capital allowances and tax depreciation services we offer include:
• Transaction support
• Capital allowances schedules
• Analysis of post acquisition capital expenditure
• Write-off reporting
• Analysis of fit out contributions and reversionary fit outs
• Annual optimisation of low value pool
• Tax depreciation modeling
• Tax depreciation audits
• Custom reporting

Why depreciation?
Capital allowances, also known as tax depreciation, are tax deductions that are available to a taxpayer to compensate them for the obsolescence and wear and tear of an asset.
Capital allowances defer the payment of tax on profits by reducing the assessable income of the taxpayer, be it an individual, a company, a trust or a superannuation fund. The ATO essentially recoups the deductions claimed through balancing adjustments and capital gains tax when the asset is sold. Only the amount of the actual loss in value of the asset is protected.
However, there are substantial timing advantages to be made in claiming the deductions. There are essentially two major forms of capital allowances which are available to eligible taxpayers under the Uniform Capital Allowance regime, and these relate to depreciating assets and buildings.

Capital expenditure
For capital allowances to be available there must be capital expenditure. Common types of capital expenditure that lead to capital allowances are:
* Acquisition of a building
* Construction of a building
* Cost of any improvement or refurbishment works
Expenditure that is incurred on repairs and maintenance is a revenue expense and as such is subject to different provisions.