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Why tax deductions could decide the winner of 2019’s The Block

By Grace Ormsby · October 07 2019
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Invest

Why tax deductions could decide the winner of 2019’s The Block

By Grace Ormsby
October 07 2019
Reading:
egg
egg
egg
The Block 2019 Oslo Hotel

Why tax deductions could decide the winner of 2019’s The Block

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By Grace Ormsby · October 07 2019
Reading:
egg
egg
egg
The Block 2019 Oslo Hotel

There’s more than $3.60 million in tax deductions to be claimed by potential property investors who successfully bid on each of The Block’s 2019 competing townhouses, the depreciation assessor has reported.

According to BMT Tax Depreciation, who has been working with The Block to provide such depreciation assessments, the attribute could increase the price that property investors are willing to pay for the property and give contestants an edge on auction day.

The Australian Taxation Office allows owners of income-producing properties to claim deductions for the wear and tear that occurs as buildings get older and items within them wear out.

BMT Tax Depreciation has noted that all properties are unique, therefore holding different depreciation benefits.

The assessor has flagged that Jesse and Mel do have an edge over their fellow competitors when it comes to tax deductions with a whopping $3,679,300 in total depreciation.

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But, according to BMT’s CEO, Bradley Beer, the field is close this year.

“Smart property investors will often make note of the depreciation potential of properties and use that data to help inform the offers they make,” he explained.

“While Jesse and Mel’s property holds the most total deductions, Mitch and Mark ($3.65 million) and Andy and Deb ($3.63 million) are hot on their heels.”

BMT’s assessment showed that Tess and Luke had the property with the lowest amount of tax deductions ($3.61 million) followed by El’ise and Matt ($3.62 million).

Jesse and Mel’s property is also ahead of the competition when looking at tax deductions more short-term.

Their townhouse has $138,055 in deductions claimable in the first year of ownership if the purpose is for an investment, with BMT noting that this would also be of interest to any investors looking to maximise the potential for returns.

The average Block property reportedly contains $131,721 in first year deductions.

“With many challenging real estate markets in Australia at present, cash flow will be a key objective for investors and this is where tax depreciation plays a large role,” Mr Beer offered.

He said regardless of whether buyers are looking to bid on the show or are looking at real estate markets across Australia, they “can make more informed decisions by understanding the depreciation values of properties and how those values will impact their cash flow”.

Why tax deductions could decide the winner of 2019’s The Block
The Block 2019 Oslo Hotel
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About the author

Grace is a journalist on Momentum Media's nestegg. She enjoys being able to provide easy to digest information and practical tips for Australians with regard to their wealth, as well as having a platform on which to engage leading experts and commentators and leverage their insight.

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About the author

Grace is a journalist on Momentum Media's nestegg. She enjoys being able to provide easy to digest information and practical tips for Australians with regard to their wealth, as well as having a platform on which to engage leading experts and commentators and leverage their insight.

Join The Nest Egg community

We Translate Complicated Financial Jargon Into Easy-To-Understand Information For Australians

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