If you run your Family Day Care business out of your home, that you either own or are paying off, then there is a deduction that may be available to you (it’s like depreciation on your home).

If your home was constructed after 17 July 1985 you may be able to claim a Capital Works deduction of up to 4% (usually 2.5%) of the construction costs….and even if your home construction is older you may be eligible for the deduction on the cost of any renovations that were done after 17 July 1985.

Please note the deduction is proportioned to the business use percentage of your house used for Family Day Care.

The deduction is available for up to 40 years following the date of construction.

The types of costs you can claim are:

              • initial costs of house construction   
              • buildings extensions, such as:
                      - a garage or patio alterations
                      - adding an internal wall for a new playroom
                      - kitchen renovations or bathroom makeovers
                      - structural improvements, such as a gazebo, carport, sealed driveway, retaining wall or fence.

What do you need to know to work out your claim? As a general rule, you can claim a deduction for the cost of constructing a residential rental property over 40 years from the date the construction was completed. However, to be sure you get your claim right, you must have all of the following:

              • the date construction commenced
              • details of the type of construction
              • the date construction was completed
              • details of who carried out the construction work
              • the construction cost (not the purchase price)
              • details of the period during the year that the property was used for income producing purposes.

For more information please call Childcare Accounting and Financial Services on 1300 785 702 to discuss what may be available to you as a deduction.