With the main goal of a Rental Investment Property being to make money, tax depreciation and tax deductions will be the main income after the rental payments received.
This is the year to do as much as we can to help your Landlords with their investment property! All of us, no matter what we do for a living want and need to make money and owners of investment properties are no different.
The Australian taxation department and websites as well as your state tenancy agency have some great information and of course your tax accountants can assist. Here are some things to consider claiming and to research further:
- Costs for professionally managing the property such as property management fees. While it is true that you need someone to help manage your property, it does cost a lot. This can and should be claimed towards your tax return. A professional Property Management company will supply an End of Financial Year Statement to take to the accountant to make claims.
- Improvements made to your home over the financial year. This could be adding a patio, a garden shed, including security screens or remodeling a bathroom. All of these expenses can be considered by your tax consultant.
- Insurance premiums to insure the property for both landlord and building & contents insurances. These are necessary expenses so by taking the policy and invoices to claim this will make a difference as it can be very expensive. Things can and will go wrong and no-one can predict what it will be or when.
- Visits to your rental property can sometimes be claimed. If you are visiting from a long distance, such as interstate, there can be some tax relief for your trip. Your property manager can write you a letter to thank you for your visit, outlining dates. Include the letter and proof of costs with your tax documents and discuss this with your consultant.
- Asking the tax consultant about Council rates, water charges and anything else that is paid for the property. By being prepared and keeping receipts we can be ready in the event of an audit.
Property managers should ask their Landlords if there is anything that they require from them such as copies of their invoices and how they can assist with arranging tax depreciation schedules or anything else that can make their lives easier. That is why property managers are there, to help their Landlords.
The last tip is that not all property managers are created equally. Speak to other investors, see what they are doing in the community and get a feel for their business. If you are having problems, it may be time to look around.