Tax Time – Tips & Tricks

201309-tax-time-generalThe end of financial year is upon us, which means it’s time to start thinking about filing tax returns.

If you own an investment property, now’s the time to reap the rewards and claim back a raft of deductions you’re entitled to.


It pays to be organised, so if you know the exact amount you wish to claim, you can actually apply to have the savings reimbursed into your weekly pay, rather than waiting for a lump sum after you’ve lodged a tax return.

Contact the ATO or Google “PAYG Withholding Variation” to find out more about this option.

One of the biggest deductions you can claim relates to property depreciation. Depreciation refers to the wear and tear of your property, which can be claimed against your accessible income over a period of time.

Property Depreciation

Just like you claim wear and tear on a car purchased for income producing purposes, you can also claim the depreciation of your investment property against your taxable income. There are two types of allowances available: depreciation on Plant and Equipment, and depreciation on Building Allowance.

Plant and Equipment refers to items within the building like ovens, dishwashers, carpet and blinds etc.

Building Allowance refers to construction costs of the building itself, such as concrete and brickwork. Both these costs can be offset against your assessable income.

A DEPRECIATION SCHEDULE WILL HELP YOU PAY LESS TAX. The amount the depreciation schedule says you claim effectively reduces your taxable income.

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Now – as a landlord there’s also a list of expenses you can claim straight off the bat. They include:

  • Advertising for tenants
  • Bank Fees: this includes set up and management fees on your bank loan along with fees on any other related account, for example to collect rent etc.
  • Body corporate or strata management fees
  • Cleaning the property
  • Council rates
  • Insurance which includes building, contents and public liability
  • Legal expenses
  • Land tax (where applicable)
  • Maintenance – like gardening, pool cleaning etc
  • Management fees paid to a real estate agent or property manager
  • Mortgage interest
  • Pest control
  • Repairs: note here, if a particular item needs repair – like an oven – the expense is an outright deduction. If you decide to replace the oven because it’s looking tired and old – the new oven will be depreciated. Any remaining deprecation on the old oven can be claimed immediately.
  • Travelling: any trips made to inspect, repair or maintain the property can also be claimed.

If the property is in need of additional repairs, try doing them before the end of June, that way you don’t have to wait up to another year to claim these expenses back.

When in doubt – collect all receipts and pass them on to your accountant. You should also hang onto these receipts for a minimum of 7 years.

So get number crunching. It’s worth it!

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