Tax Benefits of Investment Property – Part 1

Are You Missing Out On $1,000’s of Dollars???

You may have owned an investment property for some time, but have you made sure that you have maximised the potential of your investment? Have you claimed all of the tax benefits of Investment Property that you are entitled to?  This means not only achieving a market rent and consistent income flow by securing an excellent tenant but also other factors that you may not have considered.

The sooner you efficiently monitor your investment property, the sooner you’ll be in a position to buy your next investment property.

Did you know that any property built after 18 July 1985 is eligible for depreciation benefits on its historic construction costs? No matter whether your investment is new or old, it will have depreciable assets that can be claimed such as air-conditioners, whitegoods, floor and window treatments, renovations and furniture, just to mention a few items.

80% of Australian property investors do not claim these legitimate taxation benefits which is a bit like not claiming the weekly rent from your investment property. This can equate to thousands of dollars in unclaimed benefits each year.

Claiming depreciation tax benefits can assist your cash flow to pay off your principal place of residence; increase equity in your investment property; increase your cash flow or to buy another investment property.  All very useful things that you would not want to miss out on.

You may not be aware that the Australian Tax Office allows you to amend your previous four taxation returns to claim depreciation benefits so if you have been missing out, it’s not too late to do something about it.  Here is where a good accountant that understands property investment is important.

The fee for a Depreciation Schedule is fully tax deductible. Simply call our office and we can put you in touch with a tax depreciation specialist who will arrange the tax depreciation inspection and report to be undertaken.

Unfortunately many Property Investors wait until the end of the financial year and claim all of these tax deductions back at the end of the year.  This is great if you like a big tax return, but you are missing out on the benefits of using this money sooner.  By regularly applying a Taxation Variation authority, you can arrange to have less tax taken out of your salary each pay period. This is because the tax office agree that you will be claiming it at the end of the tax year and allow you to retain the money upfront.

So what is the big benefit here?  Just that you now have effectively 2 tenants in the rental property.  This increased cashflow can be used to payoff your housing loan or even to invest into another property.  Effectively speeding up the process of building your property portfolio.  You would not allow your tenant to pay all of the rent at the end of the year so why let the tax office get away with it.  Make sure that you have implemented your Taxation Variation Authority.

Building your property investment portfolio can be made easier by claiming legitimate tax deductions that you may be presently missing out on.

At Success in Property we help Australians like yourself to build a portfolio of rental properties, safely.  We seek to ensure that you are claiming every benefit that you are entitled to.

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