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Accurate Historical Estimates to Support your CGT Calculations
CPP Quantity Surveyors provide independent retrospective cost estimates for property owners, accountants and valuers who need to establish the historical cost of building works where original cost records, invoices or contracts may no longer available.
What is a retrospective estimate for CGT purposes?
A retrospective estimate provides an independent assessment of the likely cost of construction, renovation or improvement works carried out at a property in the past, based on the information available today rather than at the time the works were completed.
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These reports are commonly required when a property owner is preparing to sell an investment property, or is otherwise required to declare a capital gain, and the original builder's invoices, contracts or receipts for improvement works cannot be located.
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Using site inspections, available documentation, historical cost data and industry knowledge of construction methods and pricing at the relevant time, CPP Quantity Surveyors can prepare an independent retrospective estimate to support your Capital Gains Tax calculation.
When do you need a retrospective cost estimate?
A retrospective estimate is typically required when the Australian Taxation Office's cost base rules allow the cost of capital improvements to be included in a Capital Gains Tax calculation, but the original supporting records have been lost, discarded or were never kept.
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This commonly arises where a property has been held for many years, where renovation works were paid for in cash, where a previous owner completed the works, or where records were simply not retained. In these situations, an independent, professionally prepared cost estimate can help substantiate the historical cost of the improvements.
Who needs a retrospective CGT estimate?
Accountants & Tax Agents
Accountants regularly engage a Quantity Surveyor on behalf of their clients to obtain an independent, defensible estimate of historical construction costs where original records are unavailable. A properly prepared retrospective estimate provides supporting documentation for the cost base calculation included in a client's tax return.
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Property Owners & Investors
For property owners and investors, a retrospective estimate provides an independent record of the likely cost of past improvement works, helping to ensure that legitimate capital costs are correctly reflected when calculating a capital gain on sale.
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Valuers & Other Stakeholders
Retrospective cost estimates are also used by valuers, financial planners and legal practitioners involved in property transactions, deceased estates and family law matters where an independent assessment of historical construction cost is required.
What is included in a retrospective cost estimate?
A retrospective estimate generally includes a site inspection to identify and measure the scope of the improvement works, research into the likely construction date and methods, and an assessment of historical construction rates applicable to the relevant period.
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The report typically identifies the works assessed, the basis and methodology used to arrive at the estimated historical cost, and any assumptions or limitations relevant to the assessment. This provides accountants and property owners with clear, independent supporting documentation for their records.
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Some estimates can be based off drawings and photographs and therefore an inspection will not be required.
What information do you need to prepare a retrospective estimate?
Where available, we ask for any existing plans, approvals, photographs, previous valuations or partial invoices relating to the works, as this assists in confirming scope and timing.
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Where no records exist, CPP Quantity Surveyors can generally still prepare a retrospective estimate based on a site inspection and professional assessment of the works present, though a site inspection is usually required.
How far back can you estimate historical construction costs?
Retrospective estimates can generally be prepared for works completed at any point from 1984 onwards provided the works remain identifiable on site or through available documentation. CPP Quantity Surveyors maintains access to historical construction cost data to support estimates relating to works completed many years ago.
Why is a quantity surveyor the ideal person to prepare a retrospective estimate?
Quantity Surveyors specialise in the measurement and costing of construction works and maintain access to historical cost data and construction methodology across different periods. This makes a Quantity Surveyor well placed to provide an independent, professionally prepared estimate of historical construction costs.
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Unlike a general estimate based on assumption or rule-of-thumb figures, a Quantity Surveyor's assessment is based on recognised quantity surveying principles and current knowledge of historical construction pricing, providing a more reliable basis for accountants and property owners to rely upon.
How long does it take to prepare a retrospective estimate?
Retrospective estimates for standard residential improvements can generally be prepared within 1–2 weeks of the site inspection, depending on the scope of works and information available.
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CPP Quantity Surveyors will confirm an indicative turnaround period as part of the fixed-fee quotation.
What are your fees to prepare a retrospective CGT estimate?
Our fees to prepare a retrospective cost estimate will vary depending on the scope of works, the age of the improvements and the information available. CPP Quantity Surveyors provides fixed-fee, no obligation quotations. Simply use the enquiry button at the top of this page to request a quote.