10 tax deductions you can claim on your investment property

Updated: Jul 21, 2021

If you own an investment property, there are many expenses that are tax deductible. It's important however to only claim deductions on your property during period during which it was tenanted or genuinely available for rent. Here's a guide to the costs you can claim at tax time.

1. Loan interest

This is the biggest expense that is tax deductible. If you have a mortgage over the investment property, the interest charged on the loan is tax deductible.

2. Rental expenses

Landlords are liable to many kinds of expenses, these are deductible in the same tax year that you paid for them.

3. Rental advertising costs

Landlords need to find tenants and often do-so through advertising. Whether its online, in print, signage etc. you can claim these expenses.

4. Council rates

Rates can be deduced in the year they are paid, but you can only claim them for the time that your house was rented out.

5. Land tax

If you have a rented dwelling on your investment property, you can use land tax as a deduction. Rules about amounts and timing differ between states so be sure to check guidelines.

6. Building depreciation

Depending on how old the property is, you may be able to claim depreciation of the building's structure. Look up the guidelines for your state and area.

7. Appliance depreciation

If you've installed dishwashers, washing machines, heating, air conditioning etc. you may be able to claim depreciation deductions.

8. Pest control

Depending on who paid for the service (i.e. tenant or landlord), the cost for hiring pest control can be deducted.

9. Insurance

You can claim the cost of insuring your rental property, request an annual breakdown from your provider.

10. Legal Expenses

Cost for legal advice and documents relating to renting out your property are also tax deductible.

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