Following the Commonwealth Government Treasurer’s budget announcement concerning Tax Depreciation on 9 May 2017, the Institute has sought independent legal advice to assist members who provide Tax Depreciation Reports.


The tax lawyers’ advice stated;


“On 9 May 2017, the Government announced that from 1 July 2017, plant and equipment depreciation deductions will be limited to outlays actually incurred by real estate property investors.


The Government’s current proposal is this:

a) Investors who purchase plant and equipment for their residential property investment after 9 May 2017 will be able to claim a deduction over the effective life of the asset; and

b) Property owners will be unable to claim deductions for plant and equipment purchased by a previous owner of the property.

The following key points should be noted:

a) At present, the budget measure announced by the Government has not been passed into law;

b) The budget measure has no application to the current financial year ending 30 June 2017; and

c) If the budget measure becomes law, it will apply to the next financial year ending 30 June 2018.


Based on the latest information available from the Australian Taxation Office (ATO), we understand that legislation is currently being developed for this measure. Therefore, at present, we cannot provide any further information or guidance to you on the specific details and application of the budget measure until the legislation has been finalised and passed into law.”


The Institute has written to all coalition MP’s concerning the application of the proposed budget measures and is seeking clarification across a range of issues.


A number of government Ministers and MP’s have acknowledged the Institute’s concerns and have raised these directly with the Treasurer.

We will continue to monitor the progress of this matter and keep you updated on any further developments.