renovations
Property investors could expect to claim handsome amounts of depreciation deductions, says BMT Tax Deductions. Image – Canva.
  • The Block properties are attractive to property investors this year
  • Tax deductions ranging between $3.09 million and $3.61 million possible
  • Sizeable nature of depreciation deductions due to extensive renovations

This season’s properties on Channel 9’s The Block will see total maximum tax deductions ranging between $3.09 million and $3.61 million.

BMT Tax Depreciation CEO Bradley Beer said the sizeable nature of the depreciation deductions is due to the extent of renovations performed.

Defined as “the natural wear and tear of property and its assets”, depreciation is one of the highest tax deductions available to property investors and can be claimed for up to forty years.

The Block’s executive producer Julian Cress said with private investors often snapping up the properties, the depreciation will be a key selling point when it comes to auction time.

“The properties on this season of The Block yield an insane amount of tax depreciation deductions. A savvy property investor will factor this into their purchase decision.”

Julian Cress, The Block executive producer

Mr Beer said the substantial renovations, where all or a substantial amount of a building is removed or replaced, allow properties to qualify for strong depreciation deductions.

BMT Tax Depreciation found while the bulk of the depreciation deductions on The Block properties are attributed to capital works deductions, the plant and equipment deductions are also significant ranging between $343,000 and $386,000 per property.

Mr Beer said investors who buy the property can claim depreciation on plant and equipment assets installed during the renovation, which is not the case for most second-hand properties.

“It makes it even more attractive to the buyer.”

Bradley Beer

“Reducing tax liabilities will be part of an investor’s strategy and with these schedules, the outcome will be fantastic for the new owners.”

The highest depreciation deductions were found in Kirsty and Jesse’s House 5.

Kirsty-Jesse-House
Kirsty and Jesse’s price guide is between $2.6 million and $2.8 million. Image – Domain.
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