The challenge was that a taxpayer came to see us for the FY2019 return. We reviewed their prior-year tax return and found that they did not claim the depreciation expense for all ten years while owning the rental property. Therefore, the challenge was accurately estimating the depreciation costs, including them in prior-year tax returns, and having these refunded to our new client.
We spoke with Quantitative Surveyor and found thousands of dollars of depreciation expenses, including in the prior year’s tax returns.
Furthermore, while our new client had claimed interest expenses, they had done so only from the date when they leased the property out, rather than from the settlement date, that period is nine months.
We lodged our objections with the ATO, providing them with all the relevant supporting evidence of depreciation expense and interest expense from when the property was available to rent out.
After assessing our request, the ATO refunded back to the client more than $10,000 of tax refund for the prior years. In addition, we had helped him maximize his tax refund in the previous year because we enabled him to include more than nine months of interest expense and additional depreciation expense.
If you have an investment property, let us review your prior-year tax returns at no cost to you? Once we identify the key issues, we’ll outline the steps we can take to get you your refund.