We are now in the next financial year, which means, if you haven’t been super organised, you need to get on with gathering the information for the last tax return.

To help you on your way, here are some tips and points to consider:

General running costs

Your investment property is your business, and like any business, many running costs can be claimed for. These generally include:

• council rates
• landlord insurance
• strata/body corporate fees
• loan interest
• property management fees

Maintenance

Many of your maintenance costs are tax deductible. This includes paying for tradesmen’s time, such as a plumber and a pest control expert.

Costs associated with finding a tenant

This will often include any agency leasing fees, advertising and lease preparation costs.

Other overlooked expenses

For new investors, or if you’ve refinanced, you may be able to claim for loan establishment fees and other legal expenses. An often under estimated tax benefit is depreciation. This is the decline in value of depreciable assets in the property such as carpets, curtains and dishwashers.

Declare your all your property income

Any income generated from your property must be declared. As well as the rental income, this includes any “rental bond money you become entitled to retain, for example when a tenant defaults on rent or, in some circumstances, you incur maintenance costs and insurance pay outs.

It will also include letting and booking fees you may have received, and any amount a tenant pays you to cover the cost of repairs.

Use a financial specialist

While the latest information of what details you must include in your tax return are on the ATO website and you can prepare your own tax return, we recommend using a financial expert (your accountant or financial advisor) who will know exactly what you can and can’t claim for. Remember Property tax law is subject to change, so an expert will be on top of all the latest legislation.

Of course, paying for their services is a tax-deductible expense!

Prepare yourself for next year’s tax

Now is also the time to take a look at any maintenance issues you can offset against next year’s tax. If you haven’t got a depreciation schedule already set up, consider paying a depreciation specialist to set one up.

Added benefits of a property manager

We know we’re biased but employing a property manager is not only a tax-deductible expense, but they can also help reduce the time spent preparing your tax return.

As well as saving you time with managing your investment property, such as finding a tenant and managing your maintenance, we also manage and correctly record the financial outgoings and rental income paperwork. We send a copy of this to you at the end of each month, and also a final one at year-end to give to your accountant.

If you want some timesaving tips on how to manage your investment property paperwork, read our ‘how to make rental paperwork easy’ blog post.

With many of our team having investment properties themselves, we are always exchanging ideas and coming up with solutions.

If you want to know more about our property management services or investing in property, get in touch. Our motto is very simple – we treat every property as if it’s one of our own, and we’ve helped thousands of people realise their financial goals through property.

Our aim is to make your life easier and your property experience exceptional. Simply give us a ring on 02 4956 9777, send us an email to mail@newcastlepropertymanagement.com.au or pop into our Cardiff office for a chat.

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