- June 19, 2018
- Posted by: Rogers Property Group
- Categories: Australian Property Market, Financial Planning, Gold Coast Property Market, International Property Market, Latest News, Melbourne Property Market, Property Advice, Property Investment, Queensland Property News, Sydney Property Market
As you are no doubt aware, the end of financial year is almost here. Not only does it mean the sales are on at Myer…..but also we need to think about getting our tax returns done to claim any tax back that we may be entitled to.
Prior to buying an investment property many people are under the false impression that accounting for a property is hard. This is far from the truth. There is a few simple things that you need to make sure are in place prior to submitting your information to your accountant or submitting on-line to the ATO.
- When it comes to rent and expenses incurred for you property, you will be easily able to identify both of these through the management statement that your property manager will forward to you at end of financial year. This is just a profit and loss for your property.
- It is wise to keep a record of any other expenses that you have incurred owning the property. This may be any repairs and maintenance to your investment. It is probably not a bad idea to review your yearly bank statements just in case you have missed something.
- Depreciation. It never ceases to amaze me how many people (or accountants) are not claiming depreciation or haven’t bothered to get a depreciation schedule done. Bear in mind that if you now buy a second hand property, even if it is 2 weeks old, you are NOT entitled to claim the depreciation on fixtures and fittings This is why it is so important to build new for cash flow. Rarely will you see an old property, just purchased that is cash flow positive.
- Finally, you should have 12 interest repayments. This will generally be your biggest deduction so don’t miss this one. For those of you that have a 2 loans for the same property. (Equity land then the major loan) make sure both are accounted for even if the equity loan is secured against your home. Remember, the ATO doesn’t care where the money comes from (its security) they care about what purpose is it for.
Happy accounting people!
Subscribe to our Newsletters below and we will keep you up to date with the latest news in Accounting for Property Investors.