Depreciation on a property built in 1986

On a 1986 building, nothing is left: begun on or after 18 July 1985, its 25 years at 4% ended in 2010–11, by when they had written off the whole of its construction cost, about $65,681 for a standard 200 m² brick veneer house in New South Wales; begun before that day, it never had any. What can still be claimed on a 1986 house is every renovation and improvement begun after 15 September 1987 (each at 2.5% for 40 years from its own completion; those begun before then have run out) and plant you buy new for the property while it is let.

No: a 1986 building's years run from its completion, not from your purchase: begun on or after 18 July 1985, its 25 years ended in 2010–11; begun before that day, it never had any. Either way nothing is left to claim on the original building. Fitted new in 1986, every one of the 181 kinds of plant our catalogue prices has passed its effective life, the last ending in 2015–16. Section 40-27 reaches plant acquired from 7.30 pm on 9 May 2017, when a 1986 house was 31 years old or so: bought from an earlier owner since then, the plant that came with a 1986 house is generally not deductible (the 2017 rules set out who it reaches and the exceptions).

4% a year over 25 years, for construction begun between 18 July 1985 and 15 September 1987: counting from 30 June 1986, the 1986–87 to 2010–11 income years. Construction begun on any day of 1986 qualifies, the window having opened on 18 July 1985, and all 25 of its income years have passed. A house finished in 1986 may have been begun before 18 July 1985, and construction begun before that day claims nothing at all. Either way nothing is left on the original building. Structural improvements such as a driveway, fence or retaining wall begun with a 1986 house claim nothing, as none begun before 27 February 1992 does; one begun on or after it claims at 2.5% over 40 years.

In the year to 30 June 1986, our national series puts new houses at $319 per m² of floor area, 7% up on 1985's $298, and the average new house, about 170 m², cost about $54,000 to build. At 1986's rates, our standard 200 m² single-storey brick veneer house, less the plant listed separately, cost about $63,818 at the national rate, against $59,354 in 1985 and $67,116 in 1987. In 1986 it was cheapest in Western Australia, at $44,249, and dearest in Victoria, at $76,541. Where the 1986 build's own cost is not documented, a schedule estimates it at 1986's rates, about $63,818 for that house nationally, by an appropriately qualified person, as Taxation Ruling TR 97/25 accepts.