With the end of the financial year fast approaching, it’s important to consider any tax obligations ahead of June 30.
While property investors should be looking to work with an accountant and other professionals, here are some things to think about ahead of the deadline.
Know your deductions
Property investors are able to claim a host of deductions against their rental income. Knowing what deductions you can claim is important, as is keeping a record of all the work that has been done to your property over the course of the financial year.
Some of the most common deductions are:
- Mortgage interest payments
- Property advertising fees
- Real estate management fees
- Renters insurance
- Council and water rates
- Cleaning at the end of a tenancy
- Taxation advice relating to the property
- Gardening and maintenance fees
- Building and asset depreciation
Depending on your financial circumstances, it might be worth considering pre-paying some of your property-related expenses before the end of this financial year.
This could help lower your assessable income, which could be beneficial if you expect a lower level of income next financial year.
Save your receipts
If you’re going to be making claims for expenses related to your property, it’s important that you keep a record of everything that has been done, including dates, costs and receipts.
Many investors might not know that it’s possible to keep digital records of all of your receipts.
This can be an easy way to effectively manage all your receipts and ensure your records are in order in case you need them.
If you haven’t got everything sorted just yet, the sooner you start with good record-keeping the easier it will be in the long run.
It’s also important to keep track of any input costs, because things such as renovations can be considered capital expenses and may help reduce capital gains taxes.