Using depreciation to go from a negative to positive cash flow

Find out how this investor turned a $79 cash outlay into a $3 per week gain – just through maximising their depreciation claim.

Property purchased for $420,000 with a rental income of $25,480 per annum

An investor owns a property purchased for $420,000 with a rental income of $490 per week or a total income of $25,480 per annum. Expenses for their property such as interest, rates and management fees totalled to $32,000.

By claiming depreciation, BMT Tax Depreciation was able to turn their negative cash flow position into a positive one, saving them $4,255 for the year.

The following scenario shows this investor’s cash flow with and without depreciation.

Using depreciation to go from a negative to positive cash flow

This investor used property depreciation to turn their negative cash flow position into a positive one. Without depreciation they were paying out $79 per week. By taking advantage of tax legislation and making a depreciation claim, the investor was able to turn their loss to an income of $3 per week. In total, BMT Tax Depreciation saved this investor a total of $4,255 in just one year.

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