Multiple owners increase depreciation claims

propertySplit reports help accelerate deductions

An increase in BMT Tax Depreciation Schedules for more than one owner suggests co-ownership is becoming an increasingly popular trend.

Owning a property with others can provide improved purchasing power. This can be particularly useful in capital cities where it can be difficult to break into the property market.

It can also balance out the expenses of owning an investment property including ongoing repairs, maintenance and fees. Additionally, co-ownership can provide improved depreciation deductions, allowing more items to be depreciated at a higher rate. This is where a BMT Tax Depreciation split report can assist.

How does a split report work?

A split report calculates depreciation deductions based on each owner’s percentage of ownership for each asset. This involves splitting the value of the assets based upon each owner’s interest in the assets before applying depreciation rules.

In a scenario where there is just one owner, legislation* allows property investors to claim an immediate write-off for assets with an opening value of $300 or less. However, when an investment property is co-owned by two parties with a 50:50 ownership share, a split report allows the owners to each claim an immediate
write-off for items where their interest in the asset is below $300. This means the owners can claim an instant write-off for items which are less than $600 in total value.

The same method can be used when applying low-value pooling. Where an owner’s interest in an asset is less than $1,000, these items will qualify to be placed in a low-value pool. This means they can be claimed at an increased rate of 18.75 per cent in the first year regardless of the number of days owned and 37.5 per cent from the second year onwards.

In a situation where ownership is split 50:50, by calculating an owner’s interest in each asset first, the owners will qualify to pool assets which cost less than $2,000 in total to the low-value pool.

Distributing the value of assets based upon the percentage of ownership first will increase the number of assets which investors are eligible to claim an immediate write-off or low-value pooling for. As a result, the rate at which depreciation deductions can be applied will be accelerated and the owners will receive increased deductions in the earlier years of ownership.

BMT’s split reports simplify this process and allow owners to get more from their investment. Each split report can also be provided in CSV format for easy importing into accounting software.

There is an option for owners who prefer a depreciation schedule without any split applied should this be required.

*Under proposed changes outlined in draft legislation (section 2 of Treasury Laws Amendment Bill 2017), investors who exchange contracts on a second hand residential property after 7:30pm on 9th May 2017 will no longer be able to claim depreciation on plant and equipment assets. Investors who purchased prior to this date and those who purchase a brand new property will still be able to claim depreciation as they were previously. Investors should note that these changes are not yet law, as the legislation still needs to be passed through the senate for confirmation. BMT Tax Depreciation remain in discussion with government around the new changes and will keep our clients informed on the outcome. To learn more visit

Visit to see how a split report increases deductions for two owners.

Article provided by BMT Tax Depreciation.
Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation.
Please contact 1300 728 726 or visit for an Australia-wide service.


Consider Newcastle Before you Buy Your Next Property

CONSIDERNEWCASTLE part 2 (2)As you know, the property market is ever-changing. During the recent property we have seen dramatic variations in the prices of properties in major cities, as well as our very own Newcastle.

Back in 2015 Property Solutions 101 created an article delving into the price differences between the Sydney and Newcastle real estate markets. It was incredibly popular and many people were fascinated to see what type of properties you could afford in the two locations. Fast forward to 2017 and we have followed up to see whether there were any major changes or differences between Newcastle and Sydney real estate market. Our previous comparisons piece was over 2 years ago and the real estate market in Newcastle has changed since then.

If you haven’t already been looking seriously at purchasing in Newcastle – it’s best you act now. Whether you are looking at an investment property or looking to upsize or downside, Newcastle has something to suit any particular budget. Our city now boasts an impressive airport, massive new infrastructure development and new transport options are currently underway within the city itself. Best of all, Newcastle can offer you more affordability and better rental returns on your property investment.

If you’re worried that you don’t know where the best areas are to buy in Newcastle? Where are the flood zones? Best schools in the area? Or perhaps how to correctly price a property and deal with an agent confidently? That’s were an experienced and knowledgeable local Newcastle buyer’s agent, like Property Solutions 101, will help you solve all these problems and often save you thousands of dollars and hours of time during the property purchase process.

So if you are considering buying property in Newcastle, rather than Sydney, you are on to a hot ticket! We have compiled some comparisons for you to give you an idea of the vast differences in prices as well as the distances to travel from each city.



To sell or not to sell?

aged-care-costs-newcastleAn aging family member is experiencing significant health issues and needs more help than we can provide even when the load is shared between us all. What next?

I meet families often who are trying to agree on the right decision. Its emotional, often political and a highly stressful time. Its often associated with a lot of personal guilt feeling that the carer is giving in, but in reality, care needs can escalate to a level that becomes essential and not a choice.

The hardest conversations are those that have been urgent and without a lot of planning.

Through multiple years of advising clients in aged care in many differing circumstances my quick guide can be a great starting point for those that are unsure of where to start.

  1. Line up your ‘official’ information.

Arrange a nominee form for Centrelink to act on that person’s behalf.

Understand the previously declared assets, income and any gifted monies, update the balances if needed.

Ensure that any estate planning documents are at your finger tips, Especially enduring power of attorney and enduring guardianship. If not, make an appointment to see a solicitor.

  1. How to gain access to care at home?

If a care facility is the right way to move forward, what should we expect to pay? And how do my assets affect the fees and the pension if they move out of their home?

The simple answer is, get some help to weigh up your options.

Care arrangements depend on your allocation/budget, the allocation is determined through a process called an ACAT assessment and can be coordinated by your GP.

Once an assessment has been offered in home, it will be determined how much care and support you can access.

An excellent tool for contacting providers about care is

  1. To sell or not to sell

In relation to the decision to sell the family home or not, there are a number of factors to consider;

Is there a family member that will continue to reside in the home that is in receipt of an income support payment? This person may be considered to be a protected person in which case the home will remain exempt as an asset and not income tested until that person moves out.

In any case, the value of your property can be excluded from the asset test for up to 2 years from the date of entry to the nursing home. The issue being, that after two years, you will have had to make a decision to rent it, sell it, or wear the impact on your means tested pension caused by the asset and income tests.

We put some rational decisions back into the emotional decision of accepting a move into aged care.

There are actually three different sets of calculations that can rationalise this decision.

Pension (aged) Fees (nursing home) Income – from the home or other assets
impact to any means tested pension such as aged pension, we will consider strategies that can increase/reduce means tested pensions.


Calculation of aged care fees, especially the means tested fees? Paying a lump sum towards the Refundable Accommodation Deposit (RAD)?

Depending on your circumstances an exemption from the normal asset test may apply on a large portion of the value of your family home

  • who will remain residing in the property?
  • is the property is rented?
  • How much refundable accommodation deposit (RAD) remains outstanding?


We provide advice to personalise the optimal decision for your loved one, so that you can understand the three interconnected issues and how they might relate if you decide to retain or sell the family home.

  1. Opportunity cost

The other thing to consider is the ability to invest the monies that may be available from the sale of the property in a way that could stream an income to your loved one, to assist with paying for care costs or any reduction in means tested pension.

There are lots of options in relation to investment, we can tailor a solution to your level of comfort with ups and downs or preference for stability, and can create a regular instalment of income to prop up life’s expenses or reinvest the returns if the money is only needed every so often.

In some instances, long term exemptions are permissible if a RAD does remain outstanding and the property is rented out (with actual rent paid into a bank account). Talk to us about your family, legacy intentions and together we can understand what it means for your family.

Don’t hesitate to call a family meeting and get some advice, it’s from an adviser with experience in helping families to optimise their decisions.


Buying your first home

Buying your first home is such a significant milestone. Some key preparation can smooth the way. Most people setting a goal to purchase a home have considered their savings capacity and are building up a deposit. From our experience providing financial advice in Newcastle and the Hunter we have found that the goal needs to come first including a timeframe on when you would like to make your purchase. You are likely to be more successful in achieving your goal to buy a home when you have a date to aim for and a regular and achievable amount to save. Have a plan Start with the elusive ‘deposit’ that you need including an allowance for professional services like legal costs and stamp duty if any, pest and building reports.  Put a number to your dream house deposit and work back from there.



You have just set a budget for your monthly savings goal with a timeframe to start looking for homes.

exampleThere are other options available when a family member is comfortable offering additional security for a loan through their own home or by going guarantor. Which professional services can help me with my purchase decision?

  • Legal – Conveyancing
  • Pest and Building Inspections
  • Buyers Agent – to help research the property market
  • Home insurance
  • Lender

We have seen many property purchases happen quickly when the buyer is prepared with their team of professionals to help them at the time of negotiation. You will need to engage a conveyancer to complete the legal process for you at the time, a pest and building inspector, researching the property market and even negotiating the purchase price can be made easier if you engage a buyers’ agent to work for you. There are some great strategies to support you in your journey to buy a home, and with paying if off sooner. We recommend setting yourself up with a great overall plan including some safety provisions like personal insurance to ensure that you can afford to pay your mortgage even if something unplanned prevents you from working like an accident or illness and to ensure that you have properly documented your wishes through mechanisms like wills and powers of attorney with a legal advisor. We recommend having a real conversation about what you would want to happen if the unexpected occurred and can help you to put things in place.


FAQ Series – when planning my retirement should I take my leave? Or have it paid out to me as a lump sum?


Your starting to think about retirement and want to ensure that everything you have worked for now serves you in the best way possible.

A part of my job is meeting every day people who have worked loyally in their career and are now looking to enjoy what retirement has to offer. For some of us, that means making a decision to use up accrued annual leave and long service leave, or to take it as a lump sum?

Let’s think about it, what would your first instinct be when talking about retirement and finishing up. Over the past few appointments with clients in a similar position they have suggested they would walk into work, let the boss know they are planning to retire and take the lump sum. Quick answer, yes, but is it the best? Possibly not!

The questions that I am asked regularly are based around, when can I finish work?’ and ‘how will this affect my tax position?’. The first question that comes to mind is ‘how much leave/long service leave do you have?’

This is where we find most people start to second guess their decisions. We simply start with assessing the benefits of cashing out leave vs taking it in incremental payments.


One of the first benefits of taking it as leave instead of a lump sum is that ‘whilst you are on leave you continue to accrue leave – even on holidays’. That’s right, we have seen clients accrue a whole additional week of leave!


Tax is one of those things that is constant, but have to deal with. We talk to our clients about the capped tax rate that applies when leave is taken as a lump sum such as cashing out their long service leave.

Long Service Leave, taken as a lump sum has the protentional to be taxed at the highest marginal tax rate. When taken as leave, paid in your normal pay schedule, you will pay your normal marginal tax rate which includes the benefit of the first $18,600 tax free and then the sliding scale of your marginal tax rate thereafter.


Another advantage of taking leave rather than cashing out as a lump sum is that usually your employer will continue to pay the normal superannuation % on that leave when it is taken as a regular leave payment. This is contrasted to taking the lump sum no super guarantee % is applied to a lump sum of leave paid out. When weighing up the options it depends on the $, which benefits you more.

Our conversations do vary depending on their individual circumstances as well as their employer’s willingness and capacity to support the process of using the annual leave and long service leave leading up to a resignation as a vehicle to retirement.

Seek advice from one of our advisers, specialising in planning for a great retirement. 0249411888,


Maroba Caring Communities Transition to Care Guide

transitionAre you or a loved one considering moving into an aged care facility?

Maroba Caring Communities Transition to Care Guide is an essential read to help provide some clarity into the transition process into aged care. It will outline some of the decisions you may need to make, step you through the application process, and give you some tips to make the process easier.

Click here to view the Transition to Care Guide.


Super in your 20s. Boring? Doesn’t have to be!

20sSuperannuation is for the oldies, right? In some ways that’s true, but even in your twenties there are good reasons to take a bit more interest in your super. The average 25-year-old has around $10,000 in super, but the decisions you make now, even with relatively small sums of money, could earn you hundreds of thousands of extra dollars over your working life.

Are you getting any?

Earn more than $450 in any given month (excluding overtime, bonuses and some allowances)? Then every three months your employer should be paying 9.5% of that into your super fund. Usually you can choose your fund; if you don’t, it gets paid into a super fund of your employer’s choice. But that doesn’t mean you don’t get a say in how it’s invested.

If you don’t know if your super is being paid, or the fund it’s being paid into, ask your employer. If you think you’re missing out, search ‘unpaid super’ on the tax office website ( to see what you can do. This is your money.

Where have you got it?

Had more than one job? If you have a lot of little super accounts the money can disappear in a puff of fees and insurance premiums. Simple fix – combine your super into one account.

What about insurance?

If you don’t have any dependents, your super fund could be paying for insurance you don’t really need just yet. Cancelling unnecessary life insurance leaves more money in your account to boost your savings. On the other hand, if you do need life or disability insurance, then doing it through super could be a better option.

Is it working for YOU?

Your money is going to be stuck in super for a long time, so you want it to be working hard for you. Most funds offer a range of investment choices and some will do better than others.

Imagine your income and super contributions follow a particular pattern over the next 42 years. Your fund earns 5% per year, and when you retire it is worth $1,037,154. Now change just one thing – you choose an investment option that earns 8% each year. Now your balance could grow to over $2,000,000! That’s nearly a million bucks extra, just for ticking a different box on your super fund application form!

There’s a bit more to it. An investment choice that is expected to produce higher returns over the long term can bounce up and down in value. Some years it may even go backwards in value. However, “safer” investment options usually produce lower long-term returns.

What do you want?

Buying a new car. Travelling, Having fun. Let’s face it, there are lots more exciting things to do with your money than sticking it into super. The choice is yours but think about this:

  • If Mum and Dad retired this year, they would need a minimum of around $59,000 per year to enjoy themselves. If that doesn’t sound like much now, by the time YOU retire inflation could have pushed that annual amount to around $204,000. That means you will need to have at least $3.5 million in savings! Sure you’ve got 40-plus years but that’s still a lot of money to save up! It can be done if you start early enough – and you don’t need to miss out on enjoying life now.
  • Fact: you’re going to live much longer than your parents and grandparents. Can you imagine living another 30 years without earning an income? A sound investment plan designed to make your super work hard while you’re employed will be the difference between enjoying those decades and scraping by on a measly pension.
  • Starting early and adding a bit extra when you can makes a big difference. Let’s work on another 40 years before you can retire. If you start now by making an extra post-tax contribution of just 1% of your annual income to super, ($350 from a $35,000 salary – and the government could add to that with a co-contribution) at an 8% investment return could add an extra $149,000 to your retirement fund. If you wait 20 years before starting to make that extra contribution, you’ll only get a boost of $49,000. $100,000 less! Continuing this small extra contribution as your salary increases will turbo boost your super fund balance. Imagine your retirement party?!

So, still find super boring? That’s okay; you’re not alone. But instead of finding the time to organise all this yourself, contact a licensed financial adviser who will review your current super, any insurance required, the investment choices and prepare a strategy to get your super into shape – then you can get back to enjoying life!

Starting salary $50,000 pa increasing at 4% pa over 42 years. Super contributions fixed at 9.5% of salary and taxed at 15%. Investment returns before inflation but after tax and fees.

Income required to provide a couple with a “comfortable” level of income as calculated by The Association of Superannuation Funds of Australia (ASFA) (December 2016)

Value of $58,922 today in 42 years at 3% inflation.

Sum required to fund an annual income of $204,000 for 30 years at a return of 4% pa after inflation, fees and tax, disregarding any age pension.

The government makes a co-contribution to super for low income earners under $51,021pa (2016/17).

JCF - High Tea IWP fundraiser

Mad Hatters Heart Matters Event

JCF - High Tea IWP fundraiserWe have many conversations with clients affected directly by Heart health, or through a close family member, either through heart attack, cardiac arrest or other arrhythmia issues in their lifetime. We meet many clients that feel lucky having survived a significant event with their heart or the heart of a family or friend that had a close call.

We are in the business of helping people to insure against this risk with Critical Illness insurance and life insurance for this reason. It’s serious stuff.

In May 2014 Tabitha Tworek from Insight Wealth Planning passed out at a business dinner unexpectedly. It wasn’t the glass of wine with dinner, it was in fact a cardiac event causing a slow heart beat, less than 40bpm.

‘I was so lucky that it was found when it was,  a 24 hr holter monitor went on to confirm that whilst I slept, my heart missed firing 43 times, and some pauses were much longer than others. I went on to have a pacemaker put in a few days later, and subsequently a new device in April 2017, that now beats more than 68,000 times per day.’ Tabitha said.

It’s inspired an annual fundraising event to benefit others from this reminder that hearts matter.

Over the last two fundraisers we have invited our community of businesses and friends to join us for a get together to raise money, so far more than $4300 raised towards heart charities.

This year, we are proud to host the upcoming Mad Hatters Hearts Matter Tea Party on Sunday 16th July 2017 10am-12pm.

The Duke of Wellington
Regent Street

This year we are delighted to have chosen The Joshua Caruso Foundation to partner with to direct all funds raised to their goal of supplying defibrillator’s to local community groups, sports groups and schools in an effort to prevent a cardiac event from becoming more serious when a sudden event occurs.

For Joshua Caruso’s family August 13, 2013 started as a normal Tuesday. Josh woke up, got ready and headed off to school. On his way to the bus, Josh collapsed. His heart had stopped. He died instantly.

Josh had an undiagnosed heart condition – hypertrophic cardiomyopathy (HCM). HCM is a genetic condition that causes the muscles in the heart to thicken. It often has no symptoms; there was no indication that Josh’s heart was abnormal or that he was at risk.

Josh was a healthy, happy 13-year-old. He was a keen footy player and represented his local club at touch football. His death was a shock to both his family and the local community.

HCM is a genetic condition that often goes undiagnosed. If one member of the family is affected, it is very likely that others will be too. Josh’s parents, Joe and Belinda, have since discovered that their eldest son Nicholas has HCM. Their youngest son, Bayley, is at risk of developing it.

The Joshua Caruso Foundation was established to remember Josh and to raise money and awareness to help combat HCM.


Tickets are on sale now at

$70 per ticket including champagne on arrival.  Bring a friend or book a table, Gluten free available upon request, Tickets – for group bookings please purchase all individual tickets and email a table name with your attendees to

The Mad Hatters Hearts Matter Tea Party is proudly supported by Insight Wealth Planning, Property 101 Solutions, WSC Group Newcastle, Reno Riches, Viatek, Australian Property Finance New Lambton, Impero Conveyancing, and The Duke Hotel New Lambton.  Helping The Joshua Caruso Foundation to supply defribrillators to sporting clubs and schools in the Newcastle and Hunter region.

DUKE_LOGOWSC LogoviatekPS101-Logo-PropMgnt-Square-LargeimperoAPF KotaraRenno Riches


Property investors to lose out from proposed budget changes

investorsThe 2017 Federal Budget, handed down by Treasurer Scott Morrison on Tuesday night, 9th May at 7:30pm AEST includes proposed changes which will affect residential property investors Australia-wide.

The Australian Tax Office (ATO) allows owners of income producing property to claim depreciation deductions for the wear and tear that occurs to a building’s structure and the plant and equipment assets within.

The proposed changes relate to the depreciation of plant and equipment assets and the eligibility to claim this deduction. Currently, investors are eligible to claim qualifying plant and equipment depreciation on assets found in an investment property they purchase, even if they were installed by a previous owner.

“Under the new rules which are yet to be legislated by Parliament, investors will be able to depreciate new plant and equipment assets and items they add to their property, however subsequent owners will not be able to claim depreciation on existing plant and equipment assets,” said the Chief Executive Officer of BMT Tax Depreciation, Bradley Beer.

“This change will have a major impact on investors, essentially reducing the annual deductions they can claim therefore reducing their cash return each year. This could lead to investors being in a tighter financial position and may discourage future investors from purchasing a second hand residential property,” said Mr Beer.

“It is our understanding at this stage that if the property is new, they will be able to continue to depreciate plant and equipment as they were previously. We are seeking further clarification on this,” said Mr Beer.

Investors will still be able to claim capital works deductions also known as building write off, including any additional capital works carried out by a previous owner.

The budget notes were clear that existing investments will be grandfathered. This means that anyone who has purchased a property up until the 9th of May 2017 will be able to claim depreciation as per normal.

If a property investor exchanges contracts to purchase a second hand property after 7:30pm on the 9th May, there could be different depreciation rules applicable to their scenario.

“We are currently speaking with government to further understand the intricacies relating to the budget notes and the proposed changes to depreciation of plant and equipment assets,” said Mr Beer.


bmtt-tax-depreciationArticle provided by BMT Tax Depreciation.
Bradley Beer (B. Con. Mgt, AAIQS, MRICS, AVAA) is the Chief Executive Officer of BMT Tax Depreciation. 

Bradley joined BMT in 1998 and as such he has substantial knowledge about property investment supported by expertise in property depreciation and the construction industry. 
Bradley is a regular keynote speaker and presenter covering depreciation services on television, radio, at conferences and exhibitions Australia-wide. Please contact 1300 728 726 or visit


What to watch from the Budget? – Adviser Update

What to watch from the Budget?

TT-Insight-Advice-Shoot-400There are lots of opinion pieces about the 2017 budget. We caught up to discuss the things our advisers noted in this year’s budget rollout.

Was there anything that surprised you?

There’s a sneaky change that has been announced for the Liquid Assets waiting period (LAWP) that affects new applicants for Centrelink benefits, typically Newstart and Disability Support Pension. They have stretched the LAWP from 13 weeks to 26 weeks. This is impactful for someone that may have become unemployed suddenly that has some money in the bank, from a redundancy or from some other savings, particularly when the LAWP acts as an exclusion period when benefits will not be payable,’ Simon Tworek, Financial Planner and Director said.

The government has expressed their faith in the economy, comments were made about historically low wage growth, inflation sitting at 2% is still low, but headed for growth, the Medicare levy changes target tax payers with an increase in medicare levy from 2.0% to 2.5%.The indicators are for growth.

The levy targeting banks starts in July 2017, the government made comment on their gaze at the banks to see if there are policy adjustments and warned against passing on the new tax levy to customers. So if not customers? What does this mean for shareholders of the big four banks and Macquarie? Tabitha Tworek, Financial Planner commented.


Opportunities for first home buyers (FHB) sell a good news story, but we await further information about the potential preservation rules on these funds? Is it really a significant benefit?

Simon asked ‘what first home buyers are earning 90-100k per annum to really benefit from salary sacrifice in the ideal tax category to benefit from this?’.

We are focussing on clarity for first home buyers to confirm, what happens if they don’t choose to move in as a principal residence? (as a rentvestor instead?) Is the concessional tax rate of 15% on contributions in and the Marginal Tax Rate on the way out going to have the full benefit we would expect?

What if you change your mind? And decided on travel, study or growing your family instead? How will preservation rules impact this for real first home buyers?

For Retirees, selling their principal residence, there are additional measures to encourage a last minute contribution limit increase for super contributions that may result. This is an area that may allow more flexibility to add to super beyond the current tax free limit, already being reduced to some $300,000 per individual from 1 July 2017. We’ll update you with more information as it is further clarified.

Property investor world will be impacted, the positives include the affordable housing initiatives and deferred Capital Gains Tax relief, increased from 50% discount to 60% discount upon the sale of the asset in the future for properties meeting the criteria.

Stay tuned in the Winter newsletter for an update on the impact to depreciation for existing property investors, and more news from the budget.