Hi All
I’m going to be getting my first IP in the next 6 month and was just wondering what exactly can i claim on tax as far as the IP goes, Repairs? Landscaping fees, additives(ie air con)
anything that can be added it would be greatly appreciated, i’m sure i’m not the only one that could use advice.sucking your brains for all i can, Free advice is the cheapest i’ve found.
Thanks
TyThere are a few items that can be claimed.
- Interest & fees charged on loan
- Property management fees
- body corporate (for units)
- council rates
- water rates
- depreciation
- repairs *
Here is a link to a previous post on depreciation.
* Repairs vs improvement is a tricky subject. You can claim a repair, but can only depreciate an inprovement. An example…the element in your property’s hot water system has blown. If you replace the element, this is a repair and can be claimed. If you decide to replace the enitre HWS, (such as upgrading the size of the HWS) this is classed as a capital improvement and can only be depreciated. An accountant or Quantity Surveyor can help in this area.
Hope this helps for starters.
Hi Ty,
For a full guide – try this link.
http://www.ato.gov.au/individuals/content.asp?doc=/content/42782.htm
Derek
[email protected]Property investment advice and researched property in quality locations available.
Thanks Derek and Dram’s this infomation is great it’s just what i wanted sorry needed to now.
Just to extend on it a bit more, we are looking at building another bed room on the house, the rest of the house is old can we do the depreciation on the new extension??Ty
Hi Ty,
Anything that is an improvement is only depreciable – it is not claimable as a repair. Whereas something that constitutes a repair can be claimed in the year in which the work took place.
Derek
[email protected]Property investment advice and researched property in quality locations available.
ok guys
I have started to read the stuff on the ato web site that derek informed me of, the way i read it, if i have a loan to add the extra room on, i can claim all the interest incured on the loan. Am i reading this correct????
As for the depreciation, i can claim this each year but only get a certain % back each year, but can the new room be depreciated, the rest of the house wouldn’t be able to be due to it’s age.thanks guys, sorry for being a pain in the arse but i want to now as much as possible before i make the leap.
Ty
work smarter, not harder
Ty
That sounds correct to me. If you borrow to improve an investment property, then the interest should be dedcutible. The building cost of the room would be claimed as depreciation at 2.5% for 40 years, and any fittings in the room such as carpet etc could also be claimed via depreciation – usually over a much short time such as 5 years.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Click below to email meTerryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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