With the end of financial year knocking on our doors soon, investors can get the jump on the tax man and get ready for his arrival. Here are some easy tips investors can look into to ensure that their finances are all in check.
With landlords coming into more scrutiny than ever from the Australian Tax Office, investors need to make sure that they are doing everything above board without cutting too many corners, according to Bradley Jacobs of Boutique Property Agents.
“In order to maximise your investment in your property, it’s important to understand what areas you can claim, and steps you can take to ensure your return is accurate and prepared properly,” Mr Jacobs said.
His five quick and easy tips for investors to make tax time a breeze are:
If tax is simply too much for you, do not bite off more than you can chew and streamline the process with an accountant.
“It’s their job to help you maximise your return and can help you with what you can and can’t claim. They also have a longer deadline so you won’t have to rush to bring everything together,” Mr Jacobs said.
A somewhat obvious tip, but make sure every tax-related document is all in the one spot, as opposed to all over your home.
“There’s nothing worse than when tax time comes around and your important documents are in three different places,” said Mr Jacobs.
An investor may be able to claim their landlord’s insurance, so Mr Jacobs recommended to double check and see if it can be deducted.
“It’s valuable to look at the premium you have, to check if you can claim,” he said.
Knowing the difference between repairs and improvements may be able to help you save even more. A repair is claimable when it is considered a one-off fix and the entire expense can be claimed, while improvements, classified as “capital expenses”, can only have a small portion of the expense being claimed.
Accountants can help investors differentiate between repairs and improvements
Mr Jacobs’ last tip is to make sure you do not let claims pass you by.
“Running costs, council rates and land taxes are all possible expenses that can be claimed,” Mr Jacobs said.