Tax tips for property investors

The end of the financial year is a great time for property investors to take the opportunity to minimise their tax obligations. 

Here are five tax tips to consider this tax time: 

Claim travel expenses: The cost of travelling to inspect a property, carry out maintenance, undertake repairs or collect the rent can be claimed as a tax deduction. 

Apportion expenses: If your rental property is only available for rent for part of the year; only part of the property is available to rent; or the property is rented at non-commercial rates, you must apportion your expenses to determine the deductible amounts. 

PAYG variation: A PAYG variation allows investors to vary income tax withholding to access their end-of-year tax refund throughout the year rather than as a lump sum. This can help investors meet their cash flow demands. 

Interest: Investors can claim the interest on the loan used to purchase a rental property or depreciating asset for the rental property; make renovations or repairs to the property; or used to purchase land to build a rental property. Pre-paying interest (up to 12 months in advance) brings forward deductions to the current income year. 

Prepaid expenses: Consider pre-paying any expenditure, such as repairs, rates and levies, to maximise the current financial year’s deductions. Remember, initial repairs to an established property are not deductible.

Contact the experts at Bush & Campbell on 02 6938 4600 to help you implement these property tax tips.