I'm putting together my tax returns here, and I've just spoken to the IRD regarding depreciation of some renovations I've completed in November last year.
I was put through to their 'depreciation expert', unfortunately I don't recall his name but he sounded like he knew what he was talking about. He said that the new regulations are coming out soon, and that nearly all fixed items, such as electrical wiring, paint on the walls, tiles etc. etc. should be depreciated at the building rate of 4%...!! He made it clear that I should be doing this already know, since it was also the intention of the current regulations - the new bulletin will just be a sort of clean-up to simplify things.
Now when I look at my nice chattels valuation which I just got some weeks ago, I see all these items such as non-loadbearing walls, wiring, paths and driveways and lots of others, all categorized and depreciating at specific rates way abowe the building rate of 4%. And I think they should, since they obviously wear out faster than the building - BUT If he's right it means that I can pretty much throw this valuation out of the window.
I asked him then what about all those people who are currently using these valuations to maximise their depreciation, and his answer was that they are probably going to do investigations against them. It may be an empty threat, but who knows?
Does anyone have any thoughts on this? Warren?
I was put through to their 'depreciation expert', unfortunately I don't recall his name but he sounded like he knew what he was talking about. He said that the new regulations are coming out soon, and that nearly all fixed items, such as electrical wiring, paint on the walls, tiles etc. etc. should be depreciated at the building rate of 4%...!! He made it clear that I should be doing this already know, since it was also the intention of the current regulations - the new bulletin will just be a sort of clean-up to simplify things.
Now when I look at my nice chattels valuation which I just got some weeks ago, I see all these items such as non-loadbearing walls, wiring, paths and driveways and lots of others, all categorized and depreciating at specific rates way abowe the building rate of 4%. And I think they should, since they obviously wear out faster than the building - BUT If he's right it means that I can pretty much throw this valuation out of the window.
I asked him then what about all those people who are currently using these valuations to maximise their depreciation, and his answer was that they are probably going to do investigations against them. It may be an empty threat, but who knows?
Does anyone have any thoughts on this? Warren?
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