Invest
Tax tips for property investors
It’s critically important for property investors to lodge their tax returns accurately, according to a landlord insurance specialist. Here are her five tips for handling your taxes.
Tax tips for property investors
It’s critically important for property investors to lodge their tax returns accurately, according to a landlord insurance specialist. Here are her five tips for handling your taxes.
Carolyn Parrella, executive manager of Terri Scheer Insurance and property investor, says landlords often come under scrutiny from the ATO when lodging tax returns and it is vital they complete returns accurately.
“Landlords should consult their accountants to confirm what can and cannot be claimed as a tax-deductible expense. This ensures all claims are legitimate and the tax return amount is maximised,” Ms Parrella said.
“Seeking advice from a tax specialist can help make this time of the year much easier for landlords.”
Ms Parrella offered these five tips for tax time:
Negative gearing
“The net loss generated by negative gearing can be offset against other income to reduce the tax payable,” she said.
Ms Parrella added that landlords may be unaware interest can be claimed only when a property is available for rent.
“For example, if a property is lived in for half a year and leased as a holiday rental for the other half, you cannot claim the interest for the full 12 months.”
Insurance
Landlord insurance premiums can usually be claimed as a tax deduction, but Ms Parrella said this is typically overlooked.
She urged landlords to check their insurance policy to ensure they have the appropriate coverage.
“A standard home and contents insurance policy won’t cover landlords for the specific risks associated with property investing,” Ms Parrella said.
Expenses
Landlords may also forget to claim costs they are rightfully entitled to.
For example, apartment owners can claim body corporate fees on strata or community title properties; landlords who rent furnished property can claim rental income as a tax deduction; maintenance costs can be tax deductable and running costs such as council rates, land taxes, and water and sewerage charges can potentially be claimable.
Ms Parrella cautioned that landlords should check first with their accountant on what can and cannot be claimed before submitting their claim.
Offsetting costs
She noted that self-managing landlords might be able to claim the costs of working from home.
“If you’re a self-managed landlord, you may be able to claim some of the costs of your home office. You won’t be able to claim all the costs, such as purchasing the computer and the monthly internet bills. However, a fair and reasonable part of this may be deductible.”
Property manager
Property managers can be useful for landlords and their cost can be a deductible expense, according to Ms Parrella.
“Appointing a property manager might create a potential tax benefit while assisting with organisation and saving time for landlords,” she said.
“A good property manager will take care of the administrative responsibilities involved in an investment property. They should also be able to help reduce the burden at tax time by compiling and completing the relevant paperwork for ATO reporting.”
Property
5 ways to use COVID-19 to your property-buying advantage
With the recent revelation that Millennials believe the COVID-19 crisis has made their goals of property ownership more likely to be realised, there are a number of ways would-be buyers can take advan...Read more
Property
Why is Melbourne property falling more than everywhere else?
The fallout from COVID-19 has seen Melbourne property markets fall by 2.3 per cent, making it the worst-performing capital city, new research has shown. ...Read more
Property
More power to Millennials as property ownership proves possible
Nearly half of home-buying Millennials believe the COVID-19 situation has actually made home ownership a more achievable goal. ...Read more
Property
HomeBuilder prediction: 8 suburbs set to boom
There are eight areas that “are about to blow up”, thanks to the advent of the federal government’s HomeBuilder grant, according to a property professional. ...Read more
Property
Hot Property: Biggest headlines from the week that was
It’s a new financial year and some Victorian areas have re-entered stage 3 restrictions due to COVID-19: Here are the biggest property stories from this week. ...Read more
Property
Property market dips for second straight month
Falls in national house prices accelerated over the month of June, with the September cliff still looming, new research has shown. ...Read more
Property
COVID-induced job losses ‘less likely’ to hit borrowers
Government support and a banking system that is allowing members to defer loan repayments has led to a milder than expected mortgage delinquency rate, which could offset the impact of job losses on th...Read more
Property
Investors need structured, technology-based approach to data to succeed
Investors who want to be in the top decimal of property investors are being advised to focus on big data as a means to differentiate themselves from the rest of the group. ...Read more
Property
5 ways to use COVID-19 to your property-buying advantage
With the recent revelation that Millennials believe the COVID-19 crisis has made their goals of property ownership more likely to be realised, there are a number of ways would-be buyers can take advan...Read more
Property
Why is Melbourne property falling more than everywhere else?
The fallout from COVID-19 has seen Melbourne property markets fall by 2.3 per cent, making it the worst-performing capital city, new research has shown. ...Read more
Property
More power to Millennials as property ownership proves possible
Nearly half of home-buying Millennials believe the COVID-19 situation has actually made home ownership a more achievable goal. ...Read more
Property
HomeBuilder prediction: 8 suburbs set to boom
There are eight areas that “are about to blow up”, thanks to the advent of the federal government’s HomeBuilder grant, according to a property professional. ...Read more
Property
Hot Property: Biggest headlines from the week that was
It’s a new financial year and some Victorian areas have re-entered stage 3 restrictions due to COVID-19: Here are the biggest property stories from this week. ...Read more
Property
Property market dips for second straight month
Falls in national house prices accelerated over the month of June, with the September cliff still looming, new research has shown. ...Read more
Property
COVID-induced job losses ‘less likely’ to hit borrowers
Government support and a banking system that is allowing members to defer loan repayments has led to a milder than expected mortgage delinquency rate, which could offset the impact of job losses on th...Read more
Property
Investors need structured, technology-based approach to data to succeed
Investors who want to be in the top decimal of property investors are being advised to focus on big data as a means to differentiate themselves from the rest of the group. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.