What tax deductions can I claim on my investment property?

What tax deductions can I claim on my investment property?

What tax deductions can I claim on my investment property?

It’s that time of year again, the financial year has only days left and it’s time to think tax! You have an investment property, so now is the time to start planning your deductions, if you haven’t already done so. The easiest way to maximise your return? Make a list for your accountant with everything itemised and categorised to make tax time fuss free.

The checklist you need

We’ve pulled together a handy checklist broken down by expenses you can claim as a tax deduction, print it out and tick off each section as you go. Quick note – the expenses must be from when the property was rented or available for rent and must have been paid by you, not the tenant.

Property expenses

  • Cleaning
  • Gardening, landscaping & lawn mowing
  • Repairs & maintenance
  • Servicing costs e.g servicing a water heater, air conditioner etc.
  • Body corporate fees and charges
  • Insurances (building, contents, public liability, landlord insurance, etc.)
  • Pest control

Administration

  • Stationary and postage
  • Phone calls and line rental
  • Property agent fees & commissions or Cubbi fees
  • Secretarial, bookkeeping & accountancy fees
  • Advertising for tenants

Government

  • Water rates (remembering it can’t be an expense covered by rent, check your contract and what is covered in your rental agreement)  
  • Land tax
  • Council rates

Legal

  • Lease document expenses (preparation, registration, stamp duty)
  • Legal expenses (excluding acquisition costs and borrowing costs)
  • Quantity surveyor’s fees

Utilities

  • Electricity and gas
  • In-house audio / video service charges
  • Security system / patrol fees

Bank

  • Bank charges
  • Interest on loans
  • Mortgage discharge expenses

What do I need as proof?

You need a receipt for each item you’re claiming which includes details of the supplier, amount of the expense, date & description of the goods or service. You don’t technically need to provide your receipts when you lodge your return but the ATO may request proof anytime and most accountants require proof anyway – as they’ll want confidence in the numners they are providing to the ATO. It’s always a great idea to keep track of these expenses as the financial year progresses, and keep logs of any travel you intend to claim. For Cubbi owners, you can upload receipts when you record your expense in Cubbi, how easy is that?! Don’t forget to take advantage of being a Cubbi owner by using all of our easy to use functions, we’re here to simplify leasing out your property.

Depreciation

If you’re not already across it, depreciation is a tax deduction to cover the decline in value of any asset over time due to wear and tear. The Australian Tax Office (ATO) lets property investors claim depreciation on their taxable income each financial year for any property that produces income – like your rental property. Claiming these deductions means you pay less tax and increases the cash flow from your investment property, meaning more $ in your pocket.

For Current Cubbi owners, who are already saving money

When you log expenses in Cubbi, they are all safely recorded for tax time and ready to ship to your accountant. All you need to do is request a Tax Package from your Cubbi dashboard and you’ll receive an email with link to all expenses recorded, plus a link to receipts you’ve uploaded. You’ll also receive a PDF summary for you to forward directly to your accountant either in person or via email. Want more info? We’ve got you covered with this article

If you’re looking to save more become a Cubbi owner, use our super simple systems to track your expenses throughout the year and make next financial year work for you.