Tax Planning for Investment Property Owners

Tax Planning for Investment Property Owners

If the end of a financial year is fast approaching, now is the time to review your investment situation and take the opportunity to minimise you tax obligations and keep your funds in your pockets.

Below is a number of tax planning hints, clues and instances that may minimise your tax liability and/or increasing your potential tax refund for the current tax year.

This, of course is dependent on your personal circumstances, and, you may already be using some or all of these tax planning suggestions.

For a more detailed explanation, if you have any queries with regards to any of the suggestions or to tailor a year-end tax planning model to meet your specific needs please make contact with the Grow Accounting office on 07 5448 9600 and one of our Accountants will be happy to discuss this further.

By incorporating some of these tips & strategies listed below you could save substantial tax for this year.

The following expenses will be tax deductible if paid prior to 30th June 2014;

  • Prepaying interest on borrowed funds used to purchase the investment property. You can pay up to 12-months in advance.
  • Paying for minor repairs & maintenance i.e. cleaning or garden & lawn mowing. Consider paying for a 12-month lawn care agreement in advance.
  • Paying for any major repairs where a contractor has been engaged to carry out the work. Pay the contractor in part or in full prior to year end where an invoice has been issued.
  • Pay all insurance dues &/or prepay the next twelve months worth of cover.
  • Purchase any fixtures & fittings that cost less than $300 i.e. microwave ovens, clothes line, bathroom screens, pool equipment, door and window screens.
  • Consider travelling to visit the property carrying out routine inspections on the property before year end.
  • Have pest inspections and the property treated before 30th June 2014.
  • Have your real estate agent conduct any paid inspections if required.
  • Consider paying your rates &/or body corporate levies early if the amounts due have been raised or issued prior to 30th June 2014.
  • For those properties constructed post July 1985, obtaining a quantity surveyors report (whose fee is tax deductible) will allow you to access greater deductions for Depreciation and Capital Works. It is not uncommon for this report to increase your allowable tax claims by $2,500 or more.

I hope this information helps you plan for the next 6 months prior to the financial year end. Please feel free to contact us if need assistance with your investment property accounting needs.