Yes, for Individual Investors the Overseas Depreciation loophole was closed.eyeswideshut wrote: ↑Wed Mar 29, 2023 2:48 amDefinitely correct on the property taxes and basically all other fees and taxes related to the purchase, maintenance and management of the property. Those can all be used to create a loss that can be applied to your total income. But my understanding is that you cannot use depreciation expense on overseas properties from 2021 regardless of when they were purchased. In other words, 2020 was the last year this loophole could be used. So if you have been deducting depreciation for your flat in your 2022 and 2023 tax filings you may want to consult a professional just to confirm that this was done correctly.I bought the flat in December 2020 which I think just qualifies me. Also, all property taxes are deductible. Stamp duty for buy to lets in the UK has become quite expensive over the last few years.
I bought a place overseas in 2019 (wood-frame, 20+ years, accelerated depreciation over 4 years) and could only use the depreciation amount for the remaining months of 2019 and the full 12 months of 2020. I asked my accountant if there was any grandfathering exception and he said no. It was a hard closure on the loophole.
The scenario I described above is for Japanese Properties. I have amended the above to reflect that fact.
Apparently, corporates can still use it...