Inspection of investment properties has been a core part of the process of preparing depreciation schedules in the past. For some properties, an inspection is still the best way to ensure all capital works and assets are properly captured for the benefit of maximising the tax deductions available to the owner.
Whilst it is common practice to complete depreciation schedules for brand new properties without a site inspection (provided floor plans, asset specifications and construction cost is provided), second-hand properties have typically been inspected in person to take photos, measurements, and assess additional works. But is that always necessary?
Today, in this modern information era, we have discovered that for many properties a virtual inspection is perfectly adequate for capturing all the necessary data, and ensuring maximum tax deductions are still claimed. Capital Claims Tax Depreciation has been completing virtual property inspections for properties that qualify for over 12 months now. We have carefully tracked the results of properties inspected in person versus those inspected virtually, and our results show that for many properties there is no additional benefit to having an inspector personally attend your property. In fact, there are some added benefits to virtual inspections as outlined below.
Read further as we explain how our team can still achieve excellent results for investors, without having to personally inspect your property.
A typical property inspection for depreciation purposes includes:
Inspection of a residential property usually takes up to 30 minutes
Inspections by most quantity surveying firms are not completed by a qualified quantity surveyor. Usually an inspector is trained by a quantity surveyor to identify and photograph all of the important information in the property that will be used to complete the tax depreciation schedule.
The quantity surveyor uses the information that is captured at inspection, along with the relevant tax legislation, and their construction management qualifications to professionally estimate:
The quantity surveyor then forecasts the deductions available each year for the owner to claim as a tax deduction.
It is the age of technology. For many properties today there is comprehensive information available electronically to conduct an excellent virtual inspection of a property. There is commonly an extensive amount of online sales and rental information and photographs, along with information accessible via council databases, property manager inspections, and specific paid property information databases, combined with photos and detailed information from the owner. In our experience (over 20 years producing quality tax depreciation schedules), much of the information collected at a physical inspection by an inspector today is a duplicate of the information obtained via skilled online research combined with detailed client information.
As an investor, you should expect the same amount of deductions for a property inspected virtually, as you would for a property inspected in person (provided your quantity surveyor has the systems, tools and a skilled and experienced team to conduct the appropriate research).
In the 12 months that we have been conducting virtual inspections for some properties, we have tested our processes by:
Completing two reports for the same property completed via both methods to measure any discrepancies;
Our tests show, that properties inspected virtually still achieve the maximum deductions available to investors.
The added benefits of a virtual inspection are many:
Not every business in our market place agrees that virtual inspections combined with comprehensive online research is adequate to replace an in-person inspection. As such, they may not have implemented the technical processes and team development to deliver an equally good result.
As a business we moved officially in the direction of conducting virtual inspections for some properties over 12 months ago. We did this for a number of reasons including:
Conducting quality virtual inspections requires:
To find out if your property qualifies for a virtual inspection, please contact our friendly team on 1300 922 220 or request a quote with an estimate of deductions here.