Illegal property tax advice rampant: study
One in three firms providing property investors with depreciation reports may be breaking the law, according to a new study.
Tyron Hyde, director of quantity surveying firm Washington Brown, said under the Tax Agents Services Act 2009 (TASA) all providers of property depreciation schedules must be registered tax agents.
A study conducted by Washington Brown, however, found that more than one in three firms offering this service were not registered.
“The act was introduced to ensure firms have the adequate skill set and insurances to protect consumers,” Mr Hyde said.
“The fact that so many firms are unregistered is definitely a concern, and a case of buyer beware.”
The study looked into more than 80 firms nationwide and found that property valuers and building inspectors were often illegally offering depreciation services.
“What this means is that property investors are buying and submitting depreciation claims that could be in breach of the act,” said Mr Hyde.
Mr Hyde explained that anyone who owns an investment property is entitled to claim depreciation on their asset. Depreciation covers both the wear and tear of internal items, along with the bricks and mortar.
Investors who want to ensure they are receiving advice from a registered tax agent should ask the service provider what tax agent number will be printed on the report, according to Mr Hyde. He said they can also visit the Tax Practitioners Board website to check if the tax agent number is valid.
Each year, 1.6 million investors claim depreciation, according to the Australian Taxation Office.