As part of the COVID-19 Recovery response, the Inland Revenue allowed depreciation for commercial and industrial building, starting from 1 April 2020.

Now if your business is eligible you’ll be able to claim depreciation deductions in your tax return for commercial and industrial buildings.

Depreciation MethodBuilding Depreciation Rate (%)
Diminishing Value2%
Straight Line.1.5%

Previously, tax depreciation on all buildings was at 0% because of 2011 tax changes.

Residential buildings are not part of these depreciation changes.

But you may be able to claim depreciation for short-stay accommodation (such as AirBnB) if it’s seen as having a commercial substance.

Generally speaking, if there are 4 or more separate units within the same property and they’re used for short-stay accommodation, they can be depreciated.

Tax Issues?

Contact one of our tax advisory team by emailing bas@ursacorp.co.nz or simply call 09 281 8885 to discuss your situation today!