Tax tips for property investors

Do I need to declare rental income?

When you lodge your tax return, you need to let the Australian Taxation Office (ATO) know how much rent and rental-related income you received over the financial year.

Rental-related income can include:

• Rental bond returns (e.g. if your tenant defaulted on rent or caused damage to your property)
• Insurance payouts (e.g. when you receive a payment to compensate for damage to your property)
• Letting and booking fees you received
• Any amount a tenant pays you to cover the cost of repairs

You can find out more about rental income you must declare at the ATO website.

What rental expenses can I claim?

You can claim tax deductions for several expenses while your property is rented or available for rent.

These may include:

• Management costs (e.g. property agent fees and commission)
• Land tax
• Body corporate fees and charges
• Maintenance costs (e.g. cleaning, gardening, pest control, repairs and maintenance)
• Property loan interest expenses
• Insurance (e.g. building, contents and public liability)
• Some legal expenses
• Depreciation

What rental expenses can’t I claim?

You can’t claim tax deductions on:

• Expenses someone else has paid (e.g. electricity bills paid by your tenant)
• Property purchase costs (e.g. stamp duty)
  

You can find out more about rental expenses you can claim at the ATO website.