Tax time: What property investors can and can’t claim

It’s that time of year again: When you fantasise about all the things you’re going to spend your tax return on before actually contemplating what you can and can’t claim. 2017 has seen some changes to property related taxes that investors should know about.  

Here are the highlights:

Investors can no longer claim back their travel to investment properties. Previously an investor could claim back expenses if they were travelling to and from the property for the legitimate purposes such as collecting rent, maintaining or inspecting the property.

Investors can’t claim back against the interest expense of a loan if the use of the loan isn’t solely for the investment.  This means, if a home loan is topped up with money from an investment loan, the offset amount isn’t deductible.

AirBnb can be a great way to get a return on your investment but hosts need to increase their awareness of what they can and can’t claim. Interest can only be claimed while the property is for rent. In other words, if a property is lived in for half a year and rented out for the other half, the mortgage interest expenses can only be claimed for the six months the property was rented.

Residential investment property plant and equipment depreciation can no longer be claimed on more than 6000 items previously listed by the ATO.

You can read Domain’s full list of tips for property investors at tax time here.

In NSW, Premier Gladys Berejiklian also announced property related tax reforms, which aim to help first home buyers get a foot in the door. Chief among these was more than $1 billion of stamp duty concessions available to first home buyers.

These concessions are available to those buying property under $650,000, which means choosing a Thrive Home just became even more affordable than before!