What tax deductions can property investors claim?

Here are some of the common tax deductions property investors can claim in Australia.
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As a property investor in Australia, you are entitled to claim certain tax deductions to help reduce the amount of tax you pay on your investment property. Claiming deductions can help to improve your cash flow, but it’s important to understand which deductions you can claim and how to claim them correctly. Here are seven common tax deductions property investors can claim in Australia:

  1. Depreciation of assets: Property investors can claim a tax deduction for the depreciation of assets, such as the building itself, appliances, and furniture. The Australian Taxation Office (ATO) has a set of rules that determine the rate at which assets depreciate, and you can claim this deduction in your tax return each year.
  2. Interest on investment loans: Interest on investment loans is fully tax-deductible. This includes any interest you pay on a loan to purchase or maintain an investment property, such as mortgage interest, line of credit interest or interest on a personal loan.
  3. Property management fees: The fees you pay to your property manager are also tax-deductible. This includes any fees related to advertising, inspections, or the management of your investment property.
  4. Repairs and maintenance: Any expenses related to the repair and maintenance of your investment property are tax-deductible. This includes things like painting, plumbing, and electrical repairs.
  5. Insurance: Insurance premiums for your investment property are also tax-deductible. This includes building and contents insurance, landlord insurance, and any other insurance policies you have to protect your investment property.
  6. Council rates and land tax: Property investors can claim a deduction for council rates and land tax they pay on their investment property.
  7. Travel expenses: If you travel to your investment property for the purpose of inspecting or maintaining it, you may be able to claim some travel expenses. This can include the cost of flights, accommodation, and car hire.

It’s important to remember that you can only claim tax deductions for expenses that are directly related to your investment property. Additionally, you must keep accurate records of all expenses related to your investment property, including receipts and invoices, to ensure you can claim these deductions in your tax return.

There are quite a few tax deductions available to property investors in Australia. By understanding what you can claim and keeping accurate records, you can make the most of these deductions to help reduce the amount of tax you pay on your investment property. It’s always a good idea to speak with a qualified accountant or tax advisor for advice on your specific circumstances.

Karlie Scharfenberg
Karlie Scharfenberg

Director & Senior Finance Broker

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