SEVEN Tips FOR LANDLORDS AT TAX TIME

How to get the most from your claims this tax time.

It’s that time of the year again when everyone is preparing for the lodgements of their tax returns, especially those who own an investment property. Our Property Management team will soon be supplying all our clients with their Income & Expenditure report to lodge with their tax return. This report covers all claimable work we have conducted for them. Of course, there are other expenses associated with a rental property that can be claimed too, such as legal and accounting advice, and depreciation.

A comprehensive tax return can be the difference between the property producing a negative or positive cash flow for the fiscal year. As always, the Code Crew are here to help our clients optimise their investment, so we’ve put together our top recommendations for landlords at tax time below.

Speak to an accountant – Professional advice is imperative when you’re a Property Investor. If you don’t have a depreciation schedule – it’s said 80% of landlords don’t – then see what your accountant can do for you this financial year. 

Contact your property manager – This is an excellent opportunity to discuss the rental market, property values and your Income & Expenditure report. 

Consider small improvements now – If you can squeeze in any work requested by your tenant, then you will be able to claim the expense almost immediately if done before June 30.

Prepare paperwork – Gather all the receipts related to the running of your rental property. Get them in good order, even if you’re using an accountant. It’s a great discipline as it provides you with additional insight into the financial performance of your investment.

Know the basic rules – Tax regulations change every year, so it’s never a bad idea to know what you can claim. These include items such as:

• Interest on your loan
• Professional fees – legal, accounting and property management
• Maintenance costs/strata fees
• Depreciation – You can make claims only if you have a depreciation schedule created by a quantity surveyor.

You can also check here.

Review insurances – This is a good time to check what you’re spending on policies for content, building and landlord insurance. You can claim insurance costs for the last 12 months, and it never hurts to see if there’s a better deal out there and to double-check you’ve got appropriate coverage. 

Sell later – If you’re on the brink of selling your property, it’s a good idea to delay the transaction until July. That way, you avoid being charged capital gains tax in this fiscal year and can settle up with the taxman in the new financial year instead.

If you’ve got any further concerns about preparing for tax time, we suggest discussing these with your property manager and seeking professional accounting advice. 

This information is general only and does not constitute professional advice. You should always seek professional advice concerning your particular circumstances before acting.