Why It Matters

Office buildings carry dense fit-out. Modern offices even more so.

An A-grade CBD office tower is one of the most fit-out-rich commercial property types in the depreciation universe. The combination of ducted HVAC, lifts, access control, AV equipment, end-of-trip facilities, kitchenette and breakout areas, partitioning and carpet typically pushes the Division 40 share well above the 18% you'd see in a bare warehouse. Modern wellness-orientated buildings with EV charging, solar, and rooftop amenities push it higher again.

A specialist QS site inspection captures items often missed: perimeter heating, BMS (building management systems), lift motor and control gear, access card readers, ceiling fit-out (acoustic tiles, lighting, fire detection), partitioning and joinery, blinds and window treatments, AV displays in boardrooms, kitchenette equipment, and EV charging infrastructure.

MCG has prepared depreciation schedules for CBD towers (whole-building and floor-by-floor), suburban office parks, strata-titled offices, owner-occupier office headquarters, and tenant fit-out claims for leasehold improvements.

Quick Reference
Office vs other commercial verticals

Bare warehouse: ~82% Div 43 / 18% Div 40.

Standard office: ~70% Div 43 / 30% Div 40.

A-grade CBD with EOT, AV, EV charging: 50% Div 43 / 50% Div 40.

Tenant fit-out claim: Mostly Div 40 plus Div 43 leasehold improvements.

Why Use MCG

What you get from a specialist office QS

Six things a generic accountant or self-prepared estimate cannot match.

On-site QS inspection
A registered tax agent QS attends the building or tenancy and identifies every item, including ceiling-cavity assets and risers.
Lift and HVAC componentry
Lift motors, control gear, doors and HVAC components broken out separately, each with its own effective life.
40-year compliant schedule
Full ATO-compliant 40-year report showing both Prime Cost and Diminishing Value, year-by-year, every asset.
Tenant fit-out treatment
Where you've installed leasehold improvements as a tenant, MCG handles the apportionment and lease-term amortisation.
2 to 3 week turnaround
From site inspection to delivered schedule for a single tenancy. Multi-floor or full-tower engagements 4-6 weeks.
Registered tax agent
MCG is a Tax Practitioners Board registered tax agent firm. The schedule itself is tax deductible.
What's Depreciable

Depreciable assets typical to a commercial office

Two broad asset groups: building services and structure, and tenancy fit-out.

Building Services

Base building plant and structure

Whole-building items, captured for landlord/owner schedules

  • Lifts and lift equipmentCars, motors, control gear, doors, hoist machinery. 20-30 year effective lives, broken out separately.
  • Ducted HVACChillers, packaged units, fan coil units, perimeter heating, ductwork (where eligible), BMS controls.
  • Fire detection and suppressionSmoke detectors, sprinkler heads, EWIS systems, fire booster pumps, hose reels.
  • Building management system (BMS)Servers, controllers, sensors, software for HVAC and lighting control.
  • Common-area lightingLobby, lift cars, corridors, plant rooms. Typically LED in modern buildings.
  • End-of-trip facilitiesShowers, lockers, bike racks, towel rails, hair dryers, ironing equipment.
  • EV charging and rooftop solarWhere present, separately depreciable Division 40 plant.
Tenancy Fit-Out

Tenancy-level plant and equipment

Captured for tenant-installed fit-out claims (leasehold improvements)

  • Partitioning and joineryReception desks, meeting room walls, demountable partitions, custom joinery.
  • Carpet, flooring and ceiling tilesCarpet (8-yr life), vinyl, timber, suspended ceiling acoustic tiles.
  • Workspace lightingPendant lights, task lighting, LED panels installed by tenant.
  • AV equipmentBoardroom screens, projectors, video conferencing systems, sound systems, digital signage.
  • Access controlCard readers, intercom, electronic locks, swipe systems, time-and-attendance equipment.
  • Kitchenette and breakoutCoffee machines, dishwashers, fridges, microwaves, prep benches, water filtration.
  • Window treatments and blindsRoller blinds, venetian blinds, automated solar shading. Standard 10-year effective life.
How It Works

From enquiry to lodged schedule in 4 steps

A standard MCG office depreciation engagement, end to end.

Send building details
Address, tenancy or whole-building, settlement date, purchase price, lease details (if tenant), fit-out cost records.
QS site inspection
A registered QS attends the building, photographs every fit-out element, captures lift and HVAC componentry from plant rooms.
Schedule prepared
40-year compliant report. For tenants, leasehold improvements amortised over the shorter of useful life or remaining lease term.
Lodge with your tax return
Hand the schedule to your accountant or use it for self-prepared returns. Schedule fee is itself tax deductible.
Mike Mortlock, Co-Founder and Managing Director of MCG Quantity Surveyors
Reviewed by

Mike Mortlock

Co-Founder and Managing Director, MCG Quantity Surveyors

Mike Mortlock is a registered tax agent and the co-founder of MCG Quantity Surveyors. He sits on the AIQS Advisory Board and the PIPA Board. MCG has prepared depreciation schedules for CBD towers, suburban office parks, strata-titled offices, and tenant fit-out claims across Australia.

Registered Tax Agent (TPB) AIQS Advisory Board PIPA Board
Last reviewed: 26 April 2026 · Specialism: commercial office depreciation, tenant fit-out claims
FAQ

Common questions on commercial office depreciation

The questions office building owners, tenants, and accountants ask MCG most often.

A commercial office depreciation schedule is a 40-year ATO-compliant report itemising every depreciable asset in an office building or office tenancy. It captures the building structure (Division 43), and all plant and equipment (Division 40) including fit-out, partitioning, ducted HVAC, lifts, access control, AV equipment, end-of-trip facilities, kitchenette equipment, and any EV charging infrastructure.
Higher than a bare warehouse (around 18%), commonly 25-35% for a standard office building, and 35-50% for a fully fitted out CBD A-grade office with high-end amenities. The Division 40 share rises with the quality and density of fit-out.
Yes, where you (the tenant) own the fit-out. Tenant-installed leasehold improvements are depreciable under Division 43 over the lease term or the asset's effective life (whichever is shorter). Tenant-owned plant and equipment (workstations, AV, kitchenette, server room equipment) is Division 40 in your name.
Yes. Lifts and lift equipment are Division 40 plant and equipment. Each component (cars, motors, control gear, doors) has its own effective life, generally in the 20-30 year range. Major lift modernisations (motor replacement, control gear upgrade) are also separately depreciable when undertaken.
Yes. Showers, lockers, bike racks, towel rails, hair dryers and other end-of-trip facility fit-out are itemised. These have shorter effective lives than building structure and contribute meaningfully to early-year deductions in modern office buildings.
For strata-titled offices, the schedule covers your individual lot (your office tenancy) plus your apportioned share of common-property capital allowance items (lifts, lobby, common-area HVAC). MCG works with the strata schedule to apportion correctly.
Standard turnaround is 2 to 3 weeks from site inspection for a single tenancy or strata office. Full-tower or multi-floor engagements can take 4 to 6 weeks. Urgent turnarounds available where settlement timing requires it.
Talk To An Expert

Maximise the deductions on your office property

Talk to an MCG commercial office specialist on 1300 795 170. Registered tax agents and quantity surveyors, working across Australia.

Request A Quote 1300 795 170
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