In my property coaching practice, I have noticed chattels valuations are a key aspect which is often overlooked.
Because of this, many investors are missing out on valuable tax deductions – and extra money in their back pocket!
Why are people missing out?
On 1st April 2011 the New Zealand Inland Revenue Department (IRD) ceased depreciation claims for buildings.
I personally believe this has led a lot of investors to overlook the fact chattels can still be depreciated.
Who does it?
Chattels valuations can be conducted by anyone, however in my humble opinion, hiring a registered valuer to carry out the work can save you hassle and potential future grief, if for example, the IRD ever decide to question it.
When it comes to dealing with the IRD, we don’t want to get it wrong – the penalties can be harsh. This is why using a specialist is highly recommended.
How does it work?
Fixtures such as carpets, heat pumps, dishwashers and the like can be depreciated each year, thus minimising the overall amount of tax paid.
What you are doing by having a chattel valuation is claiming the correct depreciation rate for that particular asset (as advised by the IRD).
Where to from here?
If you think you could benefit from chattels valuations, talk to your tax adviser or contact me if you have any questions.