YEAR END TAX STRATEGIES

PREPARING FOR YEAR END – Tax tips for investment property

One of the greatest benefits of owning an investment property (besides the additional income) is your entitlement to tax benefits.

Here are some tips to maximise your tax return this 2017/18 financial year: 

Expenses you can and cannot claim

While your property is rented or available to rent, you can claim immediate deductions for rates and taxes, property management fees, insurance, body corporate fees, cleaning and gardening, and repairs and maintenance when your tenants were living in the property. You can claim deductions for capital works (building costs) and borrowing costs over several years. Costs related to the property purchase such as stamp duty, as well as expenses paid by a tenant cannot be claimed as a deduction.

Apportion expenses
If your rental property is only available for rent for part of the year, only part of the property is available to rent, or the property is rented at non-commercial rates, you must apportion your expenses to determine the deductible amounts. Prepay interest Property investors who have adequate cash flow to prepay interest on a loan can do so and claim an immediate deduction. It is also possible to prepay and claim a deduction for your upcoming property insurance premiums.

Bring forward maintenance expenditure
If there are maintenance tasks that you know will need to be completed then you may wish to complete them before 30 June in order to minimise your tax bill in the current financial year.

Record keeping measures
Investors must keep good records to substantiate their claims. The ATO requires you to keep records such as proof of earned rental income, all expenses incurred, periods of private use by you or your friends, periods the property was used as your main residence, loan documents and efforts to rent out the property.

Call us TODAY (07) 3103 8551, before the 30 June 2018 deadline on how we can help you to reduce you tax!

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