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17 Apr 2019 Claiming deductions for rental properties

The ATO advises that it is still receiving tax returns from some tax agents where travel to residential rental properties has been incorrectly included. From 1 July 2017 taxpayers can no longer claim travel expenses related to inspecting, maintaining or collecting rent for a residential rental property, unless they are an excluded entity.

The ATO has also announced that this year it has has made rental deductions a top priority, and will double the number of audits scrutinising rental deductions: ATO media release (17 April 2019).

There is a specific focus on over-claimed interest, capital works claimed as repairs, incorrect apportionment of expenses for holiday homes let out to others, and omitted income from accommodation sharing.

Key issues the ATO is checking this tax time include:

  • Is loan interest being claimed correctly?
  • Do you know the difference between capital works and repairs?
  • Do you have a holiday home?
  • Have you kept records?
  • Dealing with disasters – damaged or destroyed property.

For general information on rental properties, including a suite of educational videos, click here.



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