I’ve been told a number of times that travelling to property open inspections is not a tax deductible item, however thought I’d open up a conversion regarding this subject.
I’ve been spending a considerable amount of money on petrol costs each weekend travelling to open inspections. Over a year I would spend about $2,500.00 on petrol and car running costs attending open inspections and actions, there must be some legal way of offsetting this cost against tax?
Has anyone got any ideas or comments in this area?
Cheers
GeoffBeckIf you are buying through a trust and have a corporate trustee, you can paint your company name on your car and say that you are advertising your business while driving around!
I am not an accountant (thank God) this is only something I am thinking of doing!
We buy properties in Adelaide. Immediate Cash Settlements, No Agent Fees.
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phone 0412 437 582I believe that if you carry on Property investment as a business, then these expenses can be claimed. However if you travel around all year and by 1 or 2 properties then it’s not going to work.
Alternatively, say you were acting as buyers agernt for others, then this would effectively be a business expense also, incurred to generate fees.
The problem is that you cannot establish that the cost is directly related to a specific investment, because as you say, you may have been to 30 open houses and auctions before you decided to actually buy a place. If you could actually establish the cost to the specific investment, then it would actually form part of the cost base, and not be allowed to be claimed as an expense.
I’d love to be able to claim my recent airfares to Perth.
Mal
Getting out of your comfort zone, can help you become comfortable
Good Idea DrX
Maybe one of the accountants can offer some advice here?
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorI’ve run this ‘expense occurred whilst running around chasing new opportunities that you don’t own yet’ claim by my accountant. His response was it would be appropriate given the two following conditions ;
1. Your scale of operations justified it.
2. Apportion the business vs private use of the vehicle and claim the business use sector only. Log book entries required.
Keeping a log book for all non-private usage is a pain, but you get used to it. What adversely affects the % is when the wife wants to go down to the family farm (1,000 km round trip).
Daubing the side of the car with a logo is not necessary to claim the non-private portion of the car expenses apparently.
If you salary package your car and costs then all the expenses come out pre-tax regardless of private or personal. I own the car but package the expenses because looking at houses (oh and other things [evo]) I do a lot of kms.
Of course that’s not an option for everyone’s income source but if you do enough kms it’s worth looking into.
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