What can property investors deduct at tax time?

What can property investors deduct at tax time?

It’s that time of the year again when investors can save thousands of dollars by being savvy with deductible items on their property. From insurances to renovations, there are various items investors are eligible to claim, however many of these items can be easily missed by those without the right knowledge or an informed accountant. It’s also worth remembering that to claim a deduction, you must be able to show how much was spent, how you worked out its value, and the way the expense was calculated. Here are some common ways to minimize your tax bill. Property staples With every property purchase there are numerous staple items which are deductible regardless of the type of property. These include council rates, water rates, strata, and pest control. Insurances are also deductible including landlord’s, building, contents and public liability insurance. If you work with a property manager or real estate agent, these costs are also deductible including fees, commissions, letting fees, as well as statement and admin fees. Further to property staples, are the ongoing repairs and maintenance costs, which are likely to vary year on year depending on the work required, and age of the property. These include plumbing, electrical, handyman costs, or any supplier who aims to repair the functionality to your property. Travel can also be deductible for the owner to carry out or inspect the property, or where the sole purpose for the trip relates to the property, for instance collecting rents. Many investors should also look at claiming interest on their mortgage or loan, as it can often be the largest tax deduction within a...
Why you should consider investing outside of your home state

Why you should consider investing outside of your home state

Buying a property can be an emotional task, particularly if you’re planning on living in it and making it your home. However when it comes to investing, it is beneficial to remove that emotional attachment and look at the facts. Although you may know and live in a particular state or city, that does not necessarily make it the best investment opportunity. The Australian property landscape is extremely dynamic and diverse, ultimately presenting an array of investment opportunities. Focus on the figures Australia is not one homogeneous market, but rather a series of sub markets. The below graph illustrates how Sydney, Melbourne and Brisbane’s property markets have performed independently over the course of 20 years. Experts suggest Brisbane is a strong growth market based on the difference in median house prices which have risen from an 8.9 per cent difference to Sydney in 2009 to 86 per cent difference to Sydney in 2015.   Source: “Onwards and upwards or down and out? Where to from here?”, CoreLogic RP Data, 2015.   Many property owners could be forgiven for thinking that the whole country is experiencing similar market conditions to Sydney and Melbourne. When in actual fact, while Sydney and Melbourne markets are softening, other locations are gaining momentum. Do your research Any investment opportunity requires you to do your homework. “The most important thing is to do your research and build up your knowledge of particular geographical areas that appeal,” says Tony Brasier, president of the Real Estate Institute of Australia. ”If you invest interstate, it’s a long-term investment, not a short-term one. Taking a seven to 10 year...