Hello [baaa]
This year will be the first time I have to do a tax return on a investment property how does it work?. What do I need to take to my accountant or can I do it myself? and what taxes will I be able to claim back? I bought the unit lived in the place for 6 months while doing it up. It’s been rented out since Feb. I have a IO loan. So I guess I want to know what I will be able to claim back and what do I need to show the accountant??
Thanks in advance
Cornel
Go see an accountant. Take with you all income/agents statements, all expenses on the property, loan statements etc.
Do a listing of depreciable assets in the property and preferably get a quantity survey of your property. If your not sure do a search for depreciation reports or quantity survey.
Then maybe after a few years you may have the confidence to do your own tax. But please note, I am an accountant but still get a tax accountant to do my tax. I still need someone to discuss things with.
HI Cornel,
Like Yack I too use an accountant as the world of tax is too complicated for many of us – I also subscribe to the theory that use the experts for specialist jobs where trained expertise is required – my time is valuable.
In essence keep all pieces of paper that relate to either income or expenses associated with the property and retain them for the prescribed period of time after your return is submitted. Just because you receive the refund you though you were due doesn’t mean the tax office has approved what was claimed.
You will also need to retain all receipts and statements for sale and/or purchase of the property for 7 (or is that 5?) years after disposal just in case the ATO has capital gains questions.
I also recommend you develop a functional filing system so that your accountants job is made as easy as possible. Better records on your part should result in a more accurate tax return.
If you PM me your email address I’ll happily email you a copy of a tax claims list. I can’t attach files here.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
what if I don’t have all my receipts…my filling system is not the best and I have stuff everywhere relating to my IP. Is there stuff you can claim for where you don’t need to provide a receipts like a set amount and you can’t go higher than that unless you have receipts…..??
Thanks
Hi Cornel. I agree with Yack and Derek, go see an accountant. Take anything you think may be related to your I/P that you may be able to claim on. If you forget something that your accountant thinks you may have, just fax it through to him/her. Hope this helps.
Regards
MartyHi Cornel,
One of the keys to successful property investment is to maintain good records including matters related to tax. You need to develop a ‘business mentality’ so that deadlines and records and met and maintained throughout all aspects of your ‘business’.
I suggest at the very least you buy yourself a lever arch file and create a number of partitions. One section for documents relating to rent matters (tenancy agreements, management rights etc) another for loan/finance documents, another for purchasing documents and others as appropriate.
One section should be devoted to receipts and income statements and these should be filed as a they come in. Stay on top of the paperwork and you’ll find the task isn’t onerous – and you accountant will love you.
I suggest you develop these habits and processes early so they are ingrained as your portfolio grows.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Cornel,
Try the tax office website. They have a number of infomation booklets you can download for free and give you details on what you can claim, what documentation is required, depreciation guides etc. I would download these read them, gather the information you have already and or look for more receipts etc. Then take these to an accountant and look at what else you can claim.
The website is http://www.ato.gov.au and enter property investment into the search box.
Good luck
I have some sort of filing system…I have a big folder with everything in regarding to the contracts and bank statements and real estate statement it’s just the receipts and stuff from when I did my renovations that I can’t find half of…will just have to keep digging away I guess
Thanks for all the input
Originally posted by CornelBasson:it’s just the receipts and stuff from when I did my renovations that I can’t find half of…
Hi Cornel,
Just remember renovations are not claimable – they are depreciable – but not claimable.
Repairs are claimable – with the essence being repairing said item to workable condition.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
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