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.
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!
Susan Flux, Brisbane
Since that time I known Tony and his team at Lee and Lee, they have provided me with outstanding advice and services regarding my personal, family and especially my SMSF borrowing setup for wealth creation and tax reduction strategies that have since led to financial independence.
I now very clear and feel confident on my future financial goals and taxation strategies and know they can be achieved with Tony’s expert and professional help.
Shukri Barbara, Property Tax Specialists Sydney
Tony’s understanding of the business and tax environments, together with his experience and can do attitude enables him to deliver creative solutions outside the square as much as inside, A positive thinker I find Tony inspiring, guiding clients and associates to a prosperity mindset.
Tony has impressed me with his technical knowledge and execution. He works with honesty and integrity and is generous in his dealings.
John Mu, Internet Marketing Strategist Gold Coast
Tony Lee and his team at Lee & Lee is without a doubt Australia’s number one accounting firm.
Tony has the strategies which are helping me legally minimise tax. He has helped me in my personal development and wealth creation to build a multimillion dollar property portfolio.