Here Are 5 Ways To Reduce Tax On Your Investment Property

by | Jul 9, 2021

It’s tax time! That means we’re all heading for our calculators (or accountants) to try and find out what sort of reprieve we can receive from the tax man.

Owning an investment property can be a great way to build wealth. However, with the ever-increasing costs of living in Sydney, Melbourne & now Brisbane.   It is important that investors get every last cent back on June 30th, 2021, and here are Locate Properties’ top 5 ways to maximize the return on your investment.  

Here are 5 ways to reduce tax on your investment property. 

1) Track all of your expenses 

Make Sure To Track All Your Expenses | Here Are 5 Ways To Reduce Tax On Your Investment Property | Locate Property

The property game is no different from any other taxing business, in order to win you must be able to account for all of your expenses. By using a property management software such as remind me, which has property specific reports built-in, including capital works reporting and depreciation tracking,  you can be sure that you are claiming back every cent possible

2) Appoint a Property Specialised Accountant

Appointing a property-specific accountant is a huge help when it comes to property tax. With knowledge of property and its depreciation rules, they are able to ensure that you have all the right supporting documents for each property claim that you make.

3) Be clear in your reporting & track expenses including trips to the property

Reporting & tracking expenses | Here Are 5 Ways To Reduce Tax On Your Investment Property | Locate Property

One of the biggest issues with property investors is the failure to track property-related expenses. This may be a trip to the property, getting a plumber in for an emergency call, or even a fitting from Bunnings. By having these expenses tracked with property-specific reports you can ensure that every cent is claimed back as a deduction

4)  Claim Plant and Equipment Depreciation

Property improvements such as new air conditioning units, or new hot water systems can all be written off. You are able to claim plant & equipment depreciation on these items, ensuring that you have appointed a Property Specialist Accountant.

5) Pay off the principal mortgage as quickly as possible

The more of your capital you can get rid of, the less amount of tax you will need to pay each year.  The reason behind this is property depreciation.  The capital amount will be able to be written off each year with the property being in your portfolio for more than 12 months.  If you pay down the principal quickly, you will reduce your tax payable on property assets.

**Disclaimer:  This article contains property investment and property management information. While care has been taken to ensure the property content is accurate at the time of publication, property details can change frequently. Locate Property makes no representations or warranties as to the accuracy of the property data contained herein, which may include linked websites that are not property specific or property representatives such as developers or agents.

10 Tips To Prepare Your Home For Sale

10 Tips To Prepare Your Home For Sale

Preparing a home for sale can mean a lot of different things depending on what state or province you live in, but for the most part, there are 10 basic things that will add maximum value to the final price when you sell it on the open market. 1. Accentuate Curb Appeal...

Top 10 Simple Ideas To Create Big Rental Returns

Top 10 Simple Ideas To Create Big Rental Returns

Every investor who plans to purchase a property for rental purposes has a goal: to generate cash flow from rents and increase the value of their investments over time. Here are our top ten ideas on how you can do some simple renovations to add maximum value to your...

Tenants Breaking the Lease? Here’s What You Need to Know

Tenants Breaking the Lease? Here’s What You Need to Know

The most important thing is knowing your tenant's rights and responsibilities. If a tenant breaks a lease, they may be liable for rent until their new tenancy begins or until the end of the term, whichever occurs first. Keep in mind that if a renter breaks their...

10 Best Brisbane Suburbs For Property Investing

10 Best Brisbane Suburbs For Property Investing

If you're looking for a rental property in Brisbane, then it's important to know which suburbs are performing well. This list of the Top Ten Performing Suburbs is based on data from 2021 and will help you decide where to invest your money. Being aware of how different...