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7 Tax Tips for Property Investors

Now is the ideal time for you as an Individual to review your investment situation and take the opportunity to minimise your tax obligations.

Here is a list of tax tips for property investors;

1. Renovations by previous owner – You may be eligible for a deduction for depreciation on the cost of improvements completed by the previous owner, provided these items are identifiable and itemized in a depreciation schedule.

2. Repairs at time of purchase – Provided they are wear and tear or any other damage as a result of earning rental income, expenses for repairs to the property are deductible.

3. Prepay Property Expenses – Prepaid expenses are not automatically deductible, but a review of eligible payments should be carried out on any property expenses paid in advance.

4. Depreciation Schedule – The cost of a depreciation schedule is tax deductible, so having one prepared a qualified quantity surveyor outlines the deductions available on an investment property which can help to add a significant tax deduction for depreciation and also maximise your cash return.

5.Travel Expenses – Travels to a property to conduct an inspection, carry out maintenance or collect rent monies, may be able to be claimed as a tax deduction.

6. Keep Receipts – Keeping all receipts to prove deductions and show why the expense was incurred is very important to derive assessable income.

7. Property Data Matching – To target property investors ensuring the right amount of tax is paid the ATO uses data matching techniques such as monitoring property transaction details

written by:

McKinley Plowman