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Two weeks to reduce your property tax bill...

...for this financial year anyway!

The impending end of the financial year is a great time for investors to think about tax and ensure that all possible deductions are included.

I've chosen a few tips from a recent www.domain.com.au article.

  1. Pre-pay any known expenses - Are there any expenses that you could pay in advance? You might even get a discount, if you ask?

  2. Hire a quantity surveyor - A quantity surveyor calculates depreciation and your accountant uses it to claim deductions on assets that have declined in value over the year. Most investment property owners miss this step and leave thousands of dollars unclaimed. It's worth the few hundred dollars you'd need to pay.

  3. Always be honest - The ATO knows most stuff anyway and will catch you eventually and then charge you double the tax you avoided plus interest.

  4. Find a good accountant who has experience with rental properties and depreciation schedules.

The article also listed some things that can be claimed by investors as known at this point and some that can not be claimed.

Here's a few that you can claim:

  • Advertising for tenants

  • Bank charges

  • Body corporate fees and charges

  • Cleaning

  • Council rates

  • Gardening and lawn mowing

  • Building, contents and public liability Insurance

  • Interest on loans

  • Land tax

  • Preparation, registration and stamp duty expenses for lease documents

  • Legal expenses (excluding acquisition costs and borrowing costs)

  • Mortgage discharge expenses

  • Pest control

  • Property agent’s fees and commissions (including prior to the property being available to rent)

  • Expenses incurred in attending property investment seminars to improve the performance of a current income-producing property

  • Quantity surveyor’s fees

  • Repairs and maintenance

  • Secretarial and bookkeeping fees

  • Servicing costs, for example, servicing a water heater

  • Stationery and postage

  • Telephone calls and rental

  • Tax-related expenses

  • Water charges

Here's a few that you cannot claim:

  • Capital works deductions

  • Loan establishment fees

  • Travel expenses to inspect a property before you buy it

And from 1st July 2017...

  • Travel to inspect a property you own

  • Travel for maintenance of a property

  • Travel for rent collection

Of course you'll need to chat to your accountant about any deductions as everyone's situations vary and they have the latest information on available deductions.

The original article is here.