Rental & Investment Properties

Investing and preparing tax for an investment property is not always straightforward. Add to this, the government’s tapering of many typical property deductions and your sizable investment might not be working to its fullest capacity. So, in terms of tax considerations, yes, property investing certainly isn’t a rinse and repeat like before.

Your Rental Property Tax Considerations

Property Investors! Watch our short video to discover how ITP can assist with your property investment taxes, including tailored strategies and the latest tax knowledge to best position you, with arguably, your most valuable asset. Enjoy!

Who Needs to Lodge

Are you at risk of an audit?
Investment Property Owners (Residential)
Investment Property Owners (Commercial)
Holiday Homes & Airbnb
Rent a Room
Renting to Family or Friends
Property genuinely available for rent

Benefits of Preparing with a Professional

We are Property Investment Tax Professionals and know how best to manage all your taxable activity
Determination: Are you running a ‘business of investing’ or a ‘rental investor’? Then applying the right deductions
Depreciation: Knowing what you can claim in the year and what must be claimed over a number of years
Depprot: Discount for ITP customers
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All customers benefit from Privilege Plus Loyalty Benefits and Rewards Program
All customers are backed by our Satisfaction Guarantee that your return and our service is 100% to your liking
All Year Support and ATO Representation
The latest tax knowledge for every industry and circumstances.
Special Professional Privileges like extensions with the ATO
Multiple ways to lodge with ITP: In-Office, Virtual, Phone or Online
Sharing best practices to keep you more organised and (ATO) audit free
Online resources such as ITP’s Receipt Capturing APP, Tax Calculator, Blogs and Social Media (Facebook, Instagram, TikTok, LinkedIn, X)
Free LiveChat on our website
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Considerations and Tips

Talk to a professional before you purchase your investment property. Why? So we can help you ask the right questions and set your tax position in the most optimal position possible.

  • Is this your first home?
  • Do you already own a home and want to buy your first investment property?
  • Initial expenses such as stamp duty, may not be able to be claimed in the year in which it is incurred, ITP can help you determine which expenses are claimable and what documentation you must keep for later returns.
  • Rules regarding the CGT 50% discount need to be considered at the beginning even though it’s a future event.

Documentation to Share

  • Purchase/Sale Contracts
  • Loan Documents
  • Costs to Buy
  • Conveyancing Fees
  • Borrowing Expenses
  • Expense Receipts
  • Proof of Income (including Rental Property Income Statement)

Expenses You Can Claim

If you have the necessary documentation, you can claim immediate deductions on many property related expenses. Each Investment Property and Landlord will have their own unique circumstances, purpose and timing, so there is no one set of expenses or formula that benefits all. By preparing with a professional, a tailored solution will always give you the best tax investment results. To begin with, are you claiming correctly activities like these?

  • Advertising for Tenants
  • Bank Charges
  • Body Corporate fees
  • Cleaning •
  • Council Rates
  • Electricity and Gas
  • Gardening and Lawn Mowing
  • In-house Audio/Video Service Charges
  • Insurance – Building, Contents, Public Liability
  • Interest on Loans
  • Land Tax
  • Legal Expenses
  • Lease Costs - Preparation, Registration
  • Mortgage Discharge Expenses
  • Pest Control
  • Property Agent’s Fees and Commission
  • Quantity Surveyor’s Fees - depprot
  • Repairs and Maintenance
  • Secretarial and Bookkeeping fees
  • Security Patrol Fees
  • Servicing Costs – for example, servicing an air conditioner
  • Stationery and Postage
  • Telephone Calls
  • Tax-Related Expenses
  • Water Charges
  • And many more…

Next Steps and Support after Lodging

Navigating the complexities of investment and rental property taxes requires careful planning and informed decisions. After lodging your tax return, it’s important to stay proactive in managing your records and understanding the impacts of your investments. Our team at ITP Queensland is dedicated to providing continuous support and expert advice to help you maximise your financial benefits and stay prepared for future changes.

ITP Qld can provide:

  • Further advice on what records you should be keeping
  • Collaboration about changes and how they can affect your future tax returns
  • Depprot, benefits of a Quantity Surveyor and their costs
  • Discuss paying tax in advance to cover additional income earnt from an investment property
  • Discuss ‘Varying your PAYG withholding’ due to a Negative Geared property
  • ITP can check status of refund
  • All year Support
  • Important Dates: For an individual, the deadline for completing a tax return is generally the 31st of October. However, if this will not give enough time to get your records sorted, you may be entitled to an extension if you prepare with ITP prior to the end of October.

Frequently Asked Questions

How does rental income affect my overall tax position?
Rental income is treated as assessable income and is included in your total taxable income. Deductions can offset this income, potentially reducing your taxable income and overall tax liability.
Can I claim expenses if my investment property is negatively geared?
Yes, expenses exceeding rental income (negative gearing) can generally be claimed as tax deductions, subject to certain conditions.
How can I minimize my tax liability related to my investment property?
Strategies to minimize tax liability may include claiming eligible deductions, taking advantage of depreciation schedules, and seeking advice on tax-efficient ownership structures.
Will I end up with a payable if my investment property makes a profit?
Not necessarily. There are a lot of factors to consider, like how much profit you make each year? And how much tax has already been withheld?
Can I claim a deduction for travel expenses related to my investment property?
As of July 1, 2017, travel expenses related to residential rental properties are generally not deductible for tax purposes.
Do I need to report rental income from my investment property?
Yes, rental income must be reported in your tax return. You can also claim deductions for associated expenses.
How do I calculate depreciation on my investment property?
Depreciation can be calculated on items such as fixtures, fittings, and structural elements. A quantity surveyor's report can help determine these amounts accurately.
What expenses can I claim for my investment property?
You can typically claim expenses such as interest on loans, property management fees, repairs and maintenance, council rates, and insurance premiums.
How much tax will I pay on the Investment profit?
The tax you pay on investment profit, such as from an investment property, depends on your marginal tax rate and how long you've owned the property: Short-term (less than 12 months): Taxed at your marginal tax rate, similar to your income tax rate. Long-term (more than 12 months): Eligible for a CGT discount of 50% (for individuals) or 33.33% (for complying super funds and eligible trusts).
Are there any tax benefits to investing in property through a self-managed superannuation fund (SMSF)?
Investing in property through an SMSF can offer tax benefits such as concessional tax rates on rental income and potential CGT exemptions upon sale after retirement phase.