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time for taxes

In the 2017-2018 Federal Budget handed down by Treasurer Scott Morrison on the 9th of May 2017, the Government proposed changes to the Taxation Laws. From 1 July this year, all travel deduction relating to inspecting, maintaining or collecting rent for a rental property – previously allowable – will be disallowed. This is relevant for all investors’ tax returns next financial year.

And as a reminder, here is a list of other expenses property investors are unable to claim according to the ATO website:

  • expenses not actually paid by you, such as water or electricity charges paid by your tenants
  • acquisition and disposal costs, including the purchase cost, conveyancing and advertising costs and stamp duty on the title transfer – instead, these are usually included in the property’s cost base, which would reduce any capital gains tax when you sell the property
  • GST credits for anything you purchase to lease the premises – GST doesn’t apply to residential rental properties. However, when claiming the expense as a deduction, you claim the total amount you’ve paid (inclusive of GST, if applicable).

If you are unsure about what you can and cannot claim, we strongly suggest engaging the services of a professional tax accountant who can guide you through the process and ensue your return is correct. You can also read more from the ATO website.

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