3 Mistakes to Avoid at Tax Time

July 07, 2015
Maureen Johnson

Tax Time Tantrums

As many of us begin to prepare out tax statements for 2015 (it comes round quicker than Christmas), Smart Property blogger, Hung Tran alerts us to three possible issues that may cause residential property investors issues with the ATO.

Family Discount

If you are renting your investment property to a related member of your family you must make sure that the rental statements reflect that the rent is being paid at market value. In addition, you must also show that the rent is reviewed annually. In other words, manage the rental income the way you would if you were renting to an individual third party.

Beware the Repair

The ATO have very strict guidelines on repair vs renovate when it comes to tax deductions. In short, if you are conducting work to bring a property into line with its original condition, that is a repair. If the repair takes the property beyond its original state, you are in fact renovating.

Multi – Pitfalls

While multi purpose loans are useful for funding investment property, if the entire amount has not been used the interest incurred is NOT tax deductible.

Your Mortgage Choice broker can help you choose between a multi loan and a ‘pure’ investment loan and alert you to the implications of each further down the track.

Call the team at Mortgage Choice at Sutherland for more information on this or any investment needs.



Posted in: Property investment

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