Once upon a time that meant dusting off the shoe box or filing cabinet of printed receipts and paper bills.
These days, chances are the Australian Tax Office (ATO) has prefilled a bunch of stuff for you online, and your hunt for that missing receipt means trawling through your inbox.
In any case – make sure you know what you can claim, and what you can’t claim – or find a good accountant who can tell you.
The ATO is tipped to look at common errors rental property owners make on their tax returns, says Property Update.
One trick to look out for is to know the difference between a repair versus a capital improvement.
“General repairs and maintenance on your rental property can be claimed as an immediate deduction, but capital in nature improvements are not deductible as repairs or maintenance,” they write.
“Investors can claim the cost of repairs in the year they are incurred, whereas an improvement must be depreciated over its useful life. It is not always easy to ascertain whether a cost is a repair or improvement.”
Holiday homes, including Airbnb rentals, will also be under the magnifying glass. So talk to your accountant if you’re not sure what you can and what you can’t claim, particularly if you rented out your home or a room for part of the time, and otherwise lived there or spent time there yourself.
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