7 Tips to make the Most of Your Commercial Property at Tax Time!


SEVERAL PEOPLE have asked how to pay less tax on on their investment properties. Therefore, we’ve put together a list of our best 7 tips to help you save money at tax time.

1. Loan Interest

While a property is rented, available for rent or in the process of being built for rent, loan interest is tax deductible?– even if it is still at planning stage.

This includes the interest you pay on money you use to purchase or improve the property.

2. Depreciation

Depreciation is the decline in value of the construction costs and other related assets and its also tax deductible.

If you’re not already claiming depreciation for your rental property then you definitely should be!

3. Travel Costs

As with work related travel, you can claim your travel that relates to the rental property.

Some of the types of trips that you can claim include:

  • Travel to meet with your agents
  • Travel to meet with tradespeople/carrying out repairs on the property
  • Travel to inspect your property

Remember to use the ATO Engine Capacity rates below:

  • Lower than 1.6 Litre is 65 cents per kilometre
  • 1.6 Litre – 2.6 Litre is 76 cents per kilometre
  • Higher than 2.6 Litre is 77 cents per kilometre

4. Interstate Travel

We love this one. Flights and accommodation to inspect your interstate rental property, meet with your agent, etc. are– at least partly– claimable.

And don’t forget car hire!

5. Home Office

The time that you spend at home managing your rental property is deductible.

The ATO provides an hourly rate for power costs that you can claim for home office activity. On top of this, you can claim expenses such as:

  • A percent of your internet bills,
  • Printing and stationery costs
  • Telephone calls relating to the property

6. Land Tax

Land tax is payable on property that is not your principal place of residence.

If you own an investment property with a land value of more than $250,000, less if it is in a trust, then you should be paying land tax. The good news is that it is tax deductible.

7. Good/Bad Debt

Bad debt is debt against things like your home, credit cards, personal loans.

Good debt, however, is debt against investments. It is called good debt because you can tax deduct the interest– unlike bad debt.

There are many strategies to convert bad debt to good debt.

Bottom Line: Body Corporate fees, Professional Management/Agent fees, Insurance, Repairs, Council and Water Rates, Cleaning and Gardening … there are many things that you can deduct that will save you big dollars at tax time.

Consider getting an assessment from a professional. It could save you thousands at tax time.


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