Tax time! What property investors must know before June 30
With the current financial year drawing to a close, now is the time to ensure you are tax ready. For property investors, this means more than just combing bank statements and collecting receipts.
"For those with investment properties, tax time can sometimes be complicated due to changes in legislation," says Andrew Graham, CEO of Rental Management Australia (RMA). "Whilst gaining the right advice is helpful, having the capacity to take control of your investment is even more empowering, and RMA's cutting edge online portal gives you just that."
Simply log on, and with the click of a mouse, access all your property's information. Check your property's rental payment history and expenditure and income reports, and speak directly with your RMA Property Manager.
"Our online portal is a game changer for investors who can now access their property information at any time," says Andrew. "This, along with good advice from an accountant or financial planner, puts the investor firmly in the driver's seat."
Claim legitimate expenses
Like you, the ATO considers your investment a business which means any expenses related to your property can be claimed as tax deductions that help minimise your income tax bill. Key expenses include council rates, landlord insurance, loan interest charges and other related finance costs. List depreciable assets too, like repairs and maintenance and any wear and tear on paintwork, carpets, curtains and white goods. Expenditure in relation to maintenance and upkeep of the property are generally deductible. Improvements in most instances are depreciable over time.
Declare rental income
You must declare all income earned from your property. This includes rent, bond money, letting, and booking fees accrued over the last twelve months.
Hold onto your receipts
The ATO considers your receipts as confirmation you have spent the money you are claiming. Not presenting them at tax time means you may be denying yourself legitimate deductions if the ATO were to investigate your records.
Get your property up to speed.
Complete any maintenance work or repairs to your property now so you can claim them come June 30. If not, you’ll need to hold onto your receipts for another 12 months.
Meet with your accountant
Now you have ticked all the boxes, book a time with your accountant and have the following records ready and organised for them to work from:
• Depreciation schedule
• Income from the property and expenses
• Bank statements showing mortgage costs
• End of Year Financial Statement and copies of invoices from your RMA online portal