When Capital Works Records Are Missing: A Practical CGT Solution for Accountants

When Capital Works Records Are Missing: A Practical CGT Solution for Accountants

Accountants and tax agents frequently face a frustrating scenario — a client disposes of property but cannot provide records for historical capital works or improvements. Without accurate cost data, determining the Capital Gains Tax (CGT) position can become complex and uncertain.

Fortunately, Mintax can provide a pathway to support compliant cost base calculations when documentation is unavailable.

ATO Guidance on Missing Records

Australian Taxation Office Ruling TR 97/25 provides direction for situations where original records for capital improvements no longer exist and reconstruction of actual costs is not possible.

In these circumstances, the ATO accepts that cost estimates prepared by an appropriately qualified Quantity Surveyor may be used to support the capital works component of a CGT cost base.

This approach provides a defensible, evidence-based alternative where historical documentation cannot be substantiated.

How Mintax Supports Accurate CGT Outcomes

Mintax has developed a specialised Capital Works Cost Estimate Report designed to assist accountants and tax agents in establishing reliable cost base figures for CGT purposes.

Our methodology ensures estimates are grounded in measurable property data and professional construction cost analysis.

Our assessment process includes either:

Site Inspection
A physical inspection of the property to measure and capture relevant building characteristics and construction details.

Document-Based Assessment
Where site access is not possible, we analyse available building plans, approvals, and supporting documentation to prepare the estimate.

Important Scope Clarification

The report is prepared solely for the purpose of estimating capital works costs for CGT cost base purposes.

It does not constitute:

• a property valuation, or

• a determination of market value.

Supporting Accountants with Confidence

By providing professionally prepared capital works cost estimates aligned with ATO guidance, Mintax helps practitioners resolve missing record challenges with confidence and accuracy.

If you regularly encounter CGT scenarios involving incomplete construction records, this service provides a practical and compliant solution.

Instant Asset Write-Off: A Game-Changer for Small Businesses

Instant Asset Write-Off for Small Business.

Mintax assists property investors benefit from the Instant Asset Write-Off for Small Businesses in the 2024/25 Australian Tax Year.

For small business owners, tax time can be stressful, especially when it comes to understanding how to take full advantage of deductions and exemptions. One such opportunity is the Instant Asset Write-Off (IAWO), a valuable tax concession available to businesses that meet certain criteria.

What is the Instant Asset Write-Off (IAWO)?

The Instant Asset Write-Off allows eligible small businesses to immediately deduct the cost of eligible assets in the year they are purchased, rather than depreciating the asset over several years. This can provide a significant tax benefit, particularly for businesses investing in new equipment or vehicles.

Why you should understand the IAWO rules

Mintax was engaged to determine the IAWO benefits for an eligible business purchase in August 2024. There was no freehold contained in the purchase price of $2.9M, however the purchase included a number of eligible second-hand assets. By applying the current IAWO rules, Mintax uncovered a first-year tax deduction for the client in excess of $442,000.

1. Eligibility Criteria

To qualify for the Instant Asset Write-Off, your business must be a small business entity. The Australian Taxation Office (ATO) defines a small business as one with an aggregated turnover of less than $10 million. This threshold applies across various business structures, including sole traders, partnerships, companies, and trusts.

2. Eligible Assets

The types of assets that are eligible for the write-off include most tangible capital items, such as:

Machinery

Vehicles

Computers

Furniture

Tools and equipment

Leasehold improvements

Properties or businesses purchased during this period most likely contain second hand assets that are eligible for the IAWO, Mintax is qualified to identify and allocate costs to these assets. Assets that are not eligible typically include intangible items like intellectual property or goodwill.

3. Cost Threshold

For the 2024/25 year, small businesses can write off assets with a cost of up to $20,000. This means that businesses can purchase individual items worth less than this amount and immediately claim the full deduction. If your asset exceeds this threshold, it can still be depreciated using the regular depreciation method.

It’s important to note that this is a per asset basis—so businesses can purchase multiple items under the $20,000 threshold and write each one off separately.

4. Timing and Purchase Dates

The Instant Asset Write-Off applies to assets purchased and first used, or installed ready for use, between July 1, 2024, and June 30, 2025. Keep in mind that for an asset to be eligible, it must be used for business purposes, so personal use items don’t qualify.

5. Other Considerations

Second-hand Assets: The Instant Asset Write-Off is not limited to new assets. You can also claim a deduction for second-hand assets, provided they meet the other criteria.

Changes in Legislation: Always check the latest updates from the ATO, as the rules can change. Past years have seen adjustments to the threshold, so it’s crucial to stay informed.

Key Takeaways for Small Businesses

The IAWO is available to small businesses with an aggregated turnover of less than $10 million.

You can write off assets costing up to $20,000 per item, which applies to both new and second-hand assets.

The asset must be used for business purposes and must be purchased and used (or installed) between July 1, 2024, and June 30, 2025.

It can help your business reduce taxable income, improve cash flow, and encourage investment in assets that support growth.

Final Thoughts

The Instant Asset Write-Off is a fantastic tool for small businesses, offering immediate financial benefits and encouraging investment in your business. Before making any large purchases, make sure to consult your accountant or tax advisor to ensure the asset qualifies and you’re maximizing your tax benefits.

Mintax can assist in keeping you informed about the rules and guidelines for the 2024/25 financial year, you can use the Instant Asset Write-Off to boost your business’s financial health and invest in the assets that will drive its future growth.

Small Business Gets a Break!

On the 29th January 2019 the Morrison Government announced that Small Businesses will get an extra tax break with the instant asset write-off extended through until 30th June 2020.

Small businesses get a break!

In great news for small businesses, the tax break will be lifted immediately to cover assets worth up to $25,000 (increased from $20,000). It allows businesses with a turnover of up to $10 million a year to instantly claim tax deductions on all equipment purchases up to $25,000. Mr Morrison claimed, “Businesses can go out and invest today, whether it’s a vehicle, a piece of plant or equipment, all of it, up to $25,000, immediate write-down.”

Who is missing out?

Small business ombudsman Kate Carnell said, "It is surprising how many small businesses do not know it exists, the challenge now is to ensure that small businesses know about the instant asset write-off and are able to access it.”

Further details for small businesses.

How to maximise these opportunities.

These rules apply irrespective of whether the asset is purchased new or second-hand. There are real benefits for Small Businesses where assets form part of a business purchase and part of our commitment is knowing how to help. A Quantity Surveyor has the ability to identify and cost these second-hand assets to apply the instant write -off, maximising all claims within an ATO compliant depreciation schedule.

Contact Mintax now for further information & updates 1300 826 296 admin@mintax.com.au

285,000 Reasons For Investors To Consider Depreciation

As the end of the financial year creeps towards us, the sad reality is, that many investors and small businesses will pay more tax than they need to. And simply because they don’t know what opportunities are available to them.

What many people don’t know… despite recent ATO changes aimed at limiting residential claims, there are ways to maximise claims on renovation works, new properties and in most cases, all building works dating back as far as 1987.

But part of our commitment is knowing how to help. Which is exactly what we did over the past financial year for a small family business that ended up establishing a $285,000 first year claim. They simply couldn’t believe just how much they could actually claim.

And also… that two groups of people remain unaffected by the new government legislation, introduced in May 2017. Firstly, investors who purchased property prior to the ruling, and secondly, those who purchased new residential properties. These purchasers together with commercial & rural investors can continue to claim depreciation without change.

Increased tax savings for hundreds of hard working small businesses and investors has certainly been the highlight of our year. We don’t want people to be paying more tax that they should. If you know anyone who may benefit from a Mintax depreciation schedule in the 2017/18 tax year, please let us know! 

285,000 Reasons For Investors To Consider Depreciation

Contact us

Should you like further information or a quote for our services we can be contacted via email at admin@mintax.com.au or by phone on 1300 826 296.

Mintax a fresh approach to depreciation.

Tax Depreciation Investor Seminar

An excellent opportunity to work together with Property Duo & Investors Edge Platinum Members this week. An extremely receptive and well educated audience! Congratulations to Andrew, Paul & their team.

Tax Depreciation Investor Seminar

Interested in attending a seminar or would like more information on depreciation schedules? Contact Mintax via email at admin@mintax.com.au or by phone on 1300 826 296.

Mintax a fresh approach to depreciation.

No Need to Worry!

On Wednesday 15th November 2017, Parliament passed the Treasury Laws Amendment (Housing Tax Integrity) Bill 2017 and as such has become legislation. 

This new legislation affects the preparation of tax depreciation schedules and how investors claim depreciation on their investment property.  Investors of pre-owned residential properties are no longer able to claim depreciation on second-hand (existing) Division 40 assets such as the kitchen appliances, heating and cooling systems, carpet, blinds etc. 

There’s no need to worry as there are still thousands of dollars worth of deductions available for property investors. There have been no changes to Division 43 meaning assets such as the structure, kitchen cabinets, windows, fencing and the driveway etc will continue to be claimed as normal.  This is good news as Division 43 typically makes up around 85 - 90 per cent of the total depreciation claim. 

Commercial property owners, commercial tenants and investors who purchase or construct brand new residential properties are unaffected by the changes.

These new changes mean that it is now more important than ever to work with specialist Quantity Surveyors, like the Mintax team, to help navigate through the new legislation and to ensure you are maximising the depreciation on your investment. 

Would you like more information? Call Mintax on 1300 826 296

Mintax – A fresh approach to depreciation

Harcourts Investor Information Events

Mintax is pleased to be presenting on the benefits of a tax depreciation schedule at the current series of Harcourts investor seminars. The tax savings are increased for new residential properties and our 40 year ATO compliant tax depreciation schedules ensure maximum tax savings for property investors.

Harcourts Investor Information Events

Interested in attending the seminar or would like more information on depreciation schedules? Contact Mintax via email at admin@mintax.com.au or by phone on 1300 826 296.

Mintax a fresh approach to depreciation.

Refreshing Approach to Tax Depreciation

Since launching in January this year, the Mintax Depreciation team has rapidly gained a reputation for their refreshing approach to tax depreciation, expertly prepared reports, and providing elevated levels of personalised service. Mintax is a registered Tax Agent and our 40 year reports are fully ATO compliant. Thanks to everyone we have worked together with to date. We value your support and trust that we have delivered as promised. 

We are now preparing for the tax return deadline of 31/10/2107. We recommend all property investors contact us to ensure you are maximising all available depreciation claims. We provide residential and commercial tax depreciation schedules along with being experienced in rural properties.

If you have yet to experience our services, we encourage you to speak with Aaron and Geoff on  1300 826 296 or visit www.mintax.com.au

 “People newly appointed to positions of responsibility tend to make far-reaching changes”.