Residential property remains a secure and profitable investment, for both owner occupiers and landlords. Renting a property can stretch investment dollars because it allows investors to take advantage of a wide range of taxation benefits and deductions available.
Those which can be claimed each year against the rental income of the property include:
• Land and water rates.
• Insurance cover.
• Bank charges and accounting fees.
• Travel expenses incurred for repairs or inspections.
• Legal costs if you have to collect outstanding rents or evict tenants.
• Depreciation e.g stove, light fittings, carpets and floor coverings, hot water service, curtains and other non removable items.
Repairs to the property are deductible only if they are not improvements or structural alterations.