Investment Property Tax Tips

The new financial year is now in full swing, so if you haven’t already then it’s time to lodge your annual income tax return.

If you own an investment property then it always pays to understand what you need to claim and where deductions can be made so that you can keep clear and accurate records to help make your claim.

For those who are unsure of where deductions can be made, below I have compiled a non-exhaustive list of possible items that can be claimed if you have incurred expenses for them in the last financial year.

If you have incurred expenses over the last financial year for any of the following categories, then you may be able to claim these expenses back when you submit your tax return:

–       Council and water rates

–       Strata levies

–       Insurances

–       Agent statements

–       Bank fees

–       Repairs and maintenance

–       Interest on loans

–       Travel expenses

–       Land tax

–       Deprecation and special building write-off

–       Renovations or improvements

–       Borrowing costs

Keep in mind that the above is a non-exhaustive list and tax laws are always changing so it is important to check with the Australian Taxation Office (www.ato.gov.au) or with an accountant to gain the most up-to-date information and what can and can’t be claimed based on your individual circumstances.

If you bought your home in the last financial year there will be a bit of extra paperwork involved for your tax this year as you are required to give all details of the property including the purchase date, settlement date and purchase price. Along with these you will also need to supply all details of your mortgage and taxes paid (i.e. stamp duty) and when the property was ready to rent.

Investment property owners should also make the effort to get a depreciation schedule prepared by a quantity surveyor (this is deductible) when they first purchase their property, as many investment property owners fail to take full advantage of depreciation benefits. Both new and established properties can benefit from depreciation.

If you don’t understand what can and can’t be deducted at tax time then it is definitely recommended that you visit an accountant to make sure that you are receiving your full tax benefits.

If anyone is looking for advice about investment properties in Liverpool then don’t hesitate to contact one of the team at Professionals Paradise Realty.