Prepare Your Investment Property For The New Financial Year

Prepare Your Investment Property For The New Financial Year

At the start of the new financial year, property investors have a valuable chance to review and enhance their investment approaches. This article, brought to you by BMT Tax Depreciation, gives tips to consider to effectively gear up for the new year.

Know the important tax dates

Knowing the important tax dates is essential in preparing for the new financial year.

  • Investors who are lodging their tax return through an accountant must lodge the previous year’s return by 15 May.
  • 30 June marks the end of the financial year, which is the cut-off date to which investors can pay expenses and claim those costs in this year’s return.
  • Investors lodging their tax return through the ATO’s online MyTax portal must lodge their tax return by October 31.

Know which deductions you can claim

There are several deductions available to property investors which can improve cash flow significantly come tax time. Understanding which deductions you’re eligible for and how to maximise them can help you reduce your taxable income and lower potential tax liabilities.

The table below outlines the deductions available to property investors.

Tax deductions for investment property owners
Advertising fees Pest Control
Body corporate fees Property depreciation
Cleaning expenses Property management fees
Council rates Refinancing costs
Gardening and lawn mowing Repairs and maintenance
Insurance Tax depreciation schedule and accounting fees
Interest repayments Travel
Land tax Utilities
Legal fees Water charges

It’s important to note that expenses can only be deducted if they are directly related to an investment property.

Prepay expenses

To claim costs in the same financial year all expenses, including repairs and maintenance, interest, insurance, tax depreciation schedules, and ongoing expenses, must be paid before 30 June. Ensure that all expenses are prepaid before this date to be eligible for claiming them in the same year.

Keep records

One of the most important steps is to keep detailed records of all income and expenses associated with the property. Records should include rental income, mortgage payments, council and land taxes, insurance, costs of repairs and maintenance, and any other expenses related to the property.

Keeping records supports claims for deductions and will help you and your accountant prepare for the new financial year.

Go through an accountant

While you can prepare your own tax return, the process can be quite complex. Therefore, it’s often advisable to seek assistance from a qualified accountant. Accountants play a crucial role in helping people navigate intricate tax laws and ensure that all eligible claims are maximised and accurately filed.

Maximise deductions with depreciation

The ATO allows owners of income-producing properties to claim a tax deduction for the wear and tear of the property and its assets over time.

Depreciation is claimable under two categories. Capital works (Division 43) deductions are claimable on the building’s structure and permanent assets. Plant and equipment (Division 40) depreciation is claimable on the easily removable or mechanical assets.

Investors wanting to maximise deductions and lower their taxable income should be claiming depreciation. Claiming depreciation allows investors to recoup a portion of the costs associated with owning and maintaining an investment property.

Because depreciation is the only non-cash deduction available to investors, no money needs to be spent to claim it.

BMT Tax Depreciation find their residential clients an average claim of almost $9,000 in the first full financial year.

To learn more about preparing for the new financial year with depreciation call BMT on 1300 728 726 or Request a Quote.




More Posts

Strategies to get the most out of an investment property

Strategies to get the most out of an investment property   Maximise Depreciation Deductions: Maximising depreciation deductions is essential for property investors to significantly reduce taxable income, thereby lowering tax liabilities and increasing cash flow. Depreciation allows investors to deduct the cost of their property over its useful life, providing substantial tax benefits. By accurately assessing and maximising depreciation deductions,

Market Update | May 2024 Edition

Your May monthly update from Noel Jones, including the latest property market statistics and news from our team. Melbourne saw a relatively stable month during April, with many people taking time off during the Easter long weekend, school holidays and ANZAC Day break. Property prices remained stable for houses and units throughout the month, while industry-wide auction clearance rates held

Government Grants and Incentives for Melbourne’s Property Market in 2024

The Australian property market, particularly in major cities like Melbourne, has seen significant changes in recent years. While some government initiatives remain in place, new programs are less frequent. Let’s delve into the current landscape of government grants and incentives relevant to Melbourne’s property market. Existing Federal Government Initiatives: Home Guarantee Scheme (HGS): This ongoing program offers various guarantees for

Why Noel Jones Could Be Your Best Career Move

Are you passionate about the real estate industry and looking for a dynamic, supportive work environment? At Noel Jones we offer a unique blend of industry-leading training, cutting-edge technology, and a strong support system that sets us apart from the competition. Fuel Your Growth with Continuous Learning: At Noel Jones, we believe in empowering our team members to reach their

Send Us A Message

Good Job!

Thanks for taking the time to let me know about your needs.

I look forward to helping you find your new home.​

Buyer Requirements

Thank you!

I’ll be in touch soon with information on the suburb you’re buying in.

Find Out More