Depreciation on a property built in 1989

On a 1989 building, 2.5% of what it cost to construct, each year until 2028–29. For a standard 200 m² brick veneer house that is about $2,502 a year in New South Wales, $2,464 in Victoria and $1,997 in Queensland, with 3 income years left. That is for construction begun on or after 16 September 1987; begun before it, nothing is left on the building. Plant new to you adds to that, as does any renovation since 1989.

No: a 1989 building's 40 years run from its completion, not from your purchase, so a buyer claims the 3 income years left, 2026–27 to 2028–29, on the original construction cost rather than the price paid, where building began on or after 16 September 1987. Fitted new in 1989, every one of the 181 kinds of plant our catalogue prices has passed its effective life, the last ending in 2018–19. Section 40-27 reaches plant acquired from 7.30 pm on 9 May 2017, when a 1989 house was 28 years old or so: bought from an earlier owner since then, the plant that came with a 1989 house is generally not deductible (the 2017 rules set out who it reaches and the exceptions).

2.5% a year over 40 years, for construction begun after 15 September 1987: counting from 30 June 1989, the 1989–90 to 2028–29 income years. Construction begun on any day of 1989 qualifies, the window having opened on 16 September 1987, and 37 of its 40 income years have passed. A house finished in 1989 may have been begun on or before 15 September 1987: from 18 July 1985 at 4% over 25 years, which for a house finished in 1989 ran out by the 2014–15 income year at the latest, and before that day with no deduction at all. The years left here hold only for construction begun on or after 16 September 1987; without a record of the day building began, the reading that does not overstate the deduction is the earlier one, which leaves nothing on the original building. Structural improvements such as a driveway, fence or retaining wall begun with a 1989 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 1989, our national series puts new houses at $406 per m² of floor area, 36% up over the 4 years from 1985's $298, and the average new house, about 183 m², cost about $74,000 to build. At 1989's rates, our standard 200 m² single-storey brick veneer house, less the plant listed separately, cost about $89,060 at the national rate, against $73,608 in 1988 and $94,440 in 1990. In 1989 it was cheapest in South Australia, at $66,870, and dearest in New South Wales, at $100,084. Where the 1989 build's own cost is not documented, a schedule estimates it at 1989's rates, about $89,060 for that house nationally, by an appropriately qualified person, as Taxation Ruling TR 97/25 accepts.