The $6,000 Mistake: Why Investors Overlook Depreciation Schedules

One of the biggest “ah-ha” moments I see with landlords and investors is when they realise just how much money they’ve been leaving on the table at tax time.
It usually comes down to one thing: not getting a tax depreciation schedule.
Let me show you how two landlords, with identical properties, ended up with very different results — all because one spent a few hundred dollars on a depreciation report and the other didn’t.
Alice vs. Ben: Same Property, Different Results
Alice and Ben both bought three-bedroom townhouses in Brisbane in 2022. Same rent, same tenants, same everything.
  • Alice paid $770 for a professional tax depreciation schedule.
  • Ben skipped it to “save money.”
Here’s how that played out:
  • Alice’s Year 1 depreciation claim came in around $9,600. At a 32.5% marginal tax rate, that saved her about $3,120 in tax.
  • Ben’s accountant could only claim around $3,200 without a schedule — about $1,040 in tax savings.
Net result: Alice spent $770 and ended up more than $2,000 better off in the first year alone. Over three years, she was already $6,000 ahead.
(Disclaimer: These figures are examples only. Always check with your accountant or a qualified provider for numbers based on your own property.)
What the ATO Actually Allows
There are two main categories the ATO talks about when it comes to property deductions:
  • Capital works (Division 43): The building itself — walls, roof, concrete, and even internal paint. Claimed at 2.5% per year over 40 years.
  • Plant & equipment (Division 40): Removable or mechanical assets like carpets, ovens, blinds, hot water systems. Claimed over their “effective life.”
Here’s a quick table of common items (straight from the ATO’s 2025 list):
Item
Category
Deduction Type
Effective Life (Years)
Carpet
Plant & equipment
Tax depreciation
10
Floating timber floor
Plant & equipment
Tax depreciation
15
Internal paint
Capital works
2.5% p.a.
40
Oven
Plant & equipment
Tax depreciation
12
Hot water system
Plant & equipment
Tax depreciation
12
Ceiling fan
Plant & equipment
Tax depreciation
10
Light fittings
Plant & equipment
Tax depreciation
10
Window blinds/curtains
Plant & equipment
Tax depreciation
10
Window shutters
Plant & equipment
Tax depreciation
20
Antenna
Plant & equipment
Tax depreciation
15
Door stoppers
Plant & equipment
Tax depreciation
5
Water tank
Plant & equipment
Tax depreciation
20
(Disclaimer: Effective lives are set by the ATO and may change. Always confirm current rates at ato.gov.au or with a registered professional.)
What Does a Tax Depreciation Schedule Cost?
  • Average cost: $550–$850
  • Tax deductible: Yes, in the year you buy it
  • How long it lasts: Years — you only need to update if you renovate or add major assets
So for less than a fancy weekend away, you could be unlocking thousands in deductions every year.
Should You Get One?
Here’s the simple way I explain it:
  • Brand new property: 100% yes.
  • 5-year-old property: Usually yes.
  • 10-year-old property: Often still worth it.
  • 15+ years old: Case by case — but if you’ve renovated, it can be a big yes.
Renovations: The Game-Changer
If you’re spending $20,000 or more on upgrades — like a new kitchen, deck, flooring, or appliances — it’s almost always worth getting a tax depreciation schedule.
Don’t Forget the 2017 Rule Change
Since 9 May 2017, you can’t claim depreciation on second-hand plant & equipment if you bought the property after that date.
But you can still claim:
  • Capital works (structure, paint, etc.) over 40 years
  • Any new items you install (carpets, ovens, hot water systems, blinds, etc.)
Here’s what I think
Getting a tax depreciation schedule just makes sense. For a few hundred dollars, you can save yourself thousands — I see it with landlords all the time. But that’s just my view. Always do your own research and get the right advice for your situation.

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