I have a couple of IP's and my wife and I regularly drive around on Saturdays looking at prospective new properties. Can we claim the K's driven to look at properties we don't end up buying? It is all part of our research.
Also, can we claim a portion of our rego and insurance on the car or is that factored in by the ATO when you claim the K's?
Thanks,
Simon.
I beleive that unless you are in the business of property investing, then you cannot claim the KMs against income, but they may be able to be claimed against any CG if you buy a property and later sell it – but probably only the Ks attributable to this property
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Generally, if you are travelling to view a property you are planning on buying, you can't claim the car deductions. The reason for this is that the expense has been incurred 'too soon', because there is no income to offset the expense against.
You can claim car expenses for visiting properties you own, because the expense is seen to be incurred in gaining income. There is an income producing asset, and you are claiming deductions against that income.
There are a number of ways to claim car expenses. The most common way would be the 'cents per km' method, where you are allowed a certain amount per km. This includes all expenses related to the cost of your car.
Thanks for the info
Hi Simon g.
Yes – that would be a big 'no'. Same as you cannot claim travel (such as air fares) to look at 'potential properties' or even property inspections on places you don't buy.
Cheersyou CAN claim 5000km's per annum without substantiation though… (all you need is a reasonable justification for it)
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