Property management fees
A great real estate agent or property manager helps you achieve the best
results from your investment property, with the added bonus of any fees charged
being tax-deductible.
The fees of any other expert including a valuer, depreciation expert,
accountant, landscape designer, or interior designer are also tax-deductible.
Depreciation, relating to the wear and tear of the building and its
contents
To claim depreciation you’ll need to get a depreciation schedule
prepared at a cost of around $600-$700 (this fee is tax-deductible too).
According to the ATO, a depreciating asset is "an asset that has a
limited effective life and can reasonably be expected to decline in value over
the time it is in use".
Examples of assets that deductions for decline in value can be applied
to include:
timber flooring, carpets, curtains, appliances like a washing machine or
fridge, and furniture
Negative gearing
Negative gearing is a tax strategy that Australians have been using
for many years (if not decades) to make the prospect of owning investment
properties more manageable and more profitable.
In simple terms, negative gearing takes place when you own an asset, in
this case, property, that costs you more than you are earning from it.
For example, the interest you are paying on your mortgage and all other
associated costs with the property, equal more than the income or rent you earn
from that property.
As a result, you are making a financial loss and you can claim this as a
tax deduction.
Gardening expenses
Property owners can claim the upkeep and replacement of plants and
structures as an immediate deduction.
However, you can’t immediately claim the cost of any new plants or
changes that add extra value to the property, as these are deemed as
"improvements”.
Land tax
If the dwelling on your investment property is rented out, you can claim land tax as a deduction.
Some state governments offered land tax discounts for landlords who
provided rent relief for their tenants impacted by Covid-19.
RealRenta has all the tools that a property manager has but for
less than ¼ the cost of a property manager.
Join now and the cost is less than a cup of coffee a week to manage your
rental property
RealRenta also has a free vision, so why not check it out
Jason Gwerder
Friday, 24 June 2022