LOANS

BUYING AN INVESTMENT PROPERTY

Tax Deductions on Investment Properties

Deductions or expenses, may be offset against rental or other assessable income.   

Expenses that can be deducted from the rental income include:

• loan interest;
• body corporate fees;
• local government and water rates;
• land tax;
• gardening expenses;
• costs associated with advertising for tenants; and
• depreciation.

Depreciation refers to the writing-down of the cost of an asset over its estimated life. This form of deduction is allowed for assets such as furniture, carpet, and washing machines. You can claim a proportion of each item of depreciable assets each year over its effective life. There are different ways of calculating your depreciation. The one you choose should be decided in consultation with your accountant.

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