Newspaper article The Daily Mercury (Mackay, Australia)

7 Steps to Claiming Tax on Your Investment Property

Newspaper article The Daily Mercury (Mackay, Australia)

7 Steps to Claiming Tax on Your Investment Property

Article excerpt

TAX time can be confusing for many property investors, but getting sorted is simply a matter of following some basic rules and getting the right advice.

To help clear up the confusion, here are some steps you can take in order to maximise the tax depreciation benefits available to you.

1. Find out what you can claim

As an investor, you're entitled to claim a variety of expense-related deductions, including property management fees, rates, interest, repairs and maintenance, and depreciation. However, in order to take advantage of your property's depreciation, you'll need a tax depreciation schedule.

A typical schedule will outline all the capital works deductions available (structural items such as walls, roofs, floors, windows and doors) as well as any removable plant and equipment items in the property, such as appliances, carpets and blinds.

On average, an investor can usually expect to claim between $5000 and $10,000 in depreciation deductions in the first financial year alone.

2. Make sure you get it right for your particular property

One of the main reasons investors fail to maximise depreciation is because they mistakenly believe their property is too old to be worth claiming. Although the age of a property can affect what capital works deductions are available, plant and equipment items can still save you a bundle at tax time, regardless of the age of your property.

3. Claim depreciation deductions when working from home

Do you operate a business from your home? If so, you may be entitled to claim depreciation for the portion of the property and any plant and equipment assets used for the purposes of producing an income. If you have any questions about what items qualify for depreciation, a qualified quantity surveyor can help.

4. Get deductions for partial financial years

Many investors who've purchased a property in the lead-up to the end of the financial year wait until the following year to claim depreciation. …

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