Tax question.... Depreciation of foreign rental property
 

Tax question! Yes I know we're late, but we have an extension!

We own and rent out our property in the UK.

My understanding is that I report this income on schedule e. I'm now looking at depreciation on this. I know it has to be depreciated over 40 years because it's overseas and that I can only depreciate the buildings, not land. How to I work out how much of the purchase price relates to land and how much to buildings?

Have failed in my google search

Thanks

Sarah

Re: Tax question.... Depreciation of foreign rental property
 

Oooh just found an old thread on here! Deduct 20% for land cost? Thanks

Re: Tax question.... Depreciation of foreign rental property
 

20% is a good starting point, but can/should be adjusted if there are other factors in play. For example if the land has redevelopment potential (unlikely in the UK given the rigidity of planning permission) the percentage for the land might be higher, or if the house is especially grandiose but is in an undesirable part of town, then the percentage for land might be lower.

Re: Tax question.... Depreciation of foreign rental property
 

Thant's really. Helpful. It's a normal house in a small market town. Big ish garden, but certainly couldn't sell off a bit and build on it or anything.

The other thread (and your contributions on it) was really helpful. As was that. Thanks. Don't know what I'd do without this forum!

Re: Tax question.... Depreciation of foreign rental property
 

You're welcome. )