Rental Property Investors — Do You Know What Is Deductible & What Is Not?

For many residential investment property investors, there are a range of outgoings that are deductible and some that are not. The Australian Taxation office has in recent years focused on income tax returns of property investors targeting taxpayers who have made incorrect claims.

Do you know what is deductible? If not, then the following should assist:

WHAT IS DEDUCTIBLE IMMEDIATELY

Advertising
Body corporate fees including special levies
Cleaning
Gardening
Pest control
Council & water rates
Land Tax
Property agents’ fees & sundry charges
Postage, stationery & telephone costs
All insurances relating to the property
Repairs & maintenance (but not improvements)
Travel expenses for inspections, maintenance or rental collections
Quantity surveyors report for depreciation allowances
Interest on borrowings to finance the purchase

WHAT IS DEDUCTIBLE OVER A NUMBER OF YEARS?

Borrowing expenses including loan application fees, lenders mortgage insurance & registration fees
Depreciation on plant & equipment — from quantity surveyors report
Depreciation on building construction — from quantity surveyors report

WHAT IS NOT DEDUCTIBLE?

Costs of purchase including stamp duty & legal conveyancing costs
Costs of sale including legal costs, advertising & agents’ fees
Renovations & repairs immediately after purchase
Pre-purchase expenses including travel to inspect a property & costs of pre-purchase reports
Any costs incurred while the property was not available for rent

The Garis Group are residential investment property specialists and can assist you with any enquiries that you may have regarding investment properties and income tax. Call us on (02) 4969 4699 for a no obligation appointment or visit our website for further information www.garis.com.au