Building valuation for depreciation

[Bro123]

Hi

I am newbie and bought my property in NZ last year before moving to London for my OE.

It is time to file my Non resident tax return and I was wondering if I could use the council valuation to determine the building value for use in the depreciation calculation?

Any help is appreciated.

Thanks

[Odin]

I would say it depends on what you want. If you are looking for the most precise (and usually bigger) depreciation I would do a private valuation including a chattels valuation. Be aware of clawback tax though. If you buy a 300k house have it for 5 years and depreciate it by 50k and sell it for 300k or more then you will have to pay tax on the 50K

Odin

[Green Fish]

One alternative is to notify the IRD that you are not going to claim any depreciation.

If you do this and then sell the property several years later, there will be no issue re recovered depreciation.

[tpr2]

Get a depreciation schedule done and claim the depreciation.

If you get a claw back it is only paying back the tax that you already claimed and will be paid out of the proceeds of the sale so why not use the IRD's money now?

Also if you never sell it you have forgone all that cashflow on the premise that you "might" get a clawback later.

[MoatMaster]

There is no clawback on increase in land value though - so always pays to get an updated valuation when selling as well.

[Wayne]

Get a depreciation schedule done and claim the depreciation.

If you get a claw back it is only paying back the tax that you already claimed and will be paid out of the proceeds of the sale so why not use the IRD's money now?

Also if you never sell it you have forgone all that cashflow on the premise that you "might" get a clawback later.

and any clawback on todays claim will be paid for with tomorrows devalued $

[tpr2]

and any clawback on todays claim will be paid for with tomorrows devalued $

even better I hadn't even thought about that as an advantage. Excellent point.

[Wayne]

even better I hadn't even thought about that as an advantage. Excellent point.

win win for you - lose lose for IRD. Psst - don't tell them.

[Re@der]

If you cant organise a chattel and building valuation you could use the purchase price and percentages given by the GV for land and improvements as something to depreciate from. As the people above are pointing out though you are losing a lot of opportunity to use the taxpayers money (In this case yourself) by not getting a chattel valuation.

[Rosco]

Have a look at www.valuit.co.nz

These are the only people I would use for a chattels valuation.

Ross

[CJ]

and any clawback on todays claim will be paid for with tomorrows devalued $

Becareful about tax brackets though. You dont want to get a tax benefit of 33% only to have to pay it back at 38%.

[Wayne]

Becareful about tax brackets though. You dont want to get a tax benefit of 33% only to have to pay it back at 38%.

Better to get a benefit now at 38% and pay it back in 10yrs time at 33% (or better still 19.5%).