Property Tax Deductible Accountants Sydney NSW Investor and Property Specialists

In examining immediate deductions associated with rental properties, TLK Partner and property acquisition tax expert Matthew Mousa takes a closer look at allowable deductibles.

Kingsgrove, Australia - May 16, 2019 /NewsNetwork/ —

Property Investor Advice: Interest, Land Tax and Other Deductibles

In examining immediate deductions associated with rental properties, TLK Partner and property acquisition tax expert Matthew Mousa takes a closer look at certain areas like interest, council rates, land tax, legal expenses, tax-related expenses and mortgage discharge expenses.

The interest charged on a loan raised to acquire an investment rental property is deductible. If, however, the owner changes his mind and decide to use the property for personal use, they can only deduct the interest charged on the loan until their intention for the property changed.

“As long as the property is rented, or available for rent, you can also claim the interest on loans used to purchase depreciating assets, repairs and renovations,” Matthew clarifies. “The deduction applies from the time you take out the loan, even if you use the loan to finance major renovations on a property you intend to rent out to tenants when the renovations are complete.”

As of 1 July 2019, Australian investors will lose the right to claim all expenses, including interest, associated with the holding of land intended for income producing assessable future income. “It’s referred to as an ‘integrity measure’ to be introduced to wipe out fraud, whereby investors had been claiming the deduction of interest on land that had not ultimately been used by that investor as an income-producing asset,” Matthew explains.

However, most banks in Australia offer loans that can be used to buy a rentable property and, at the same time, get a new car. In this scenario, he says, property owners may only deduct the proportion of the interest on the loan used to buy the property – the interest charged for the section of the loan used for buying the car may not be deducted.

RELATED ARTICLE: CGT TAX Accountants Sydney NSW Are Investor and Property Acquisition Investment Specialists

The critical thing about land tax deductions involves the time-period for which the owner is liable for it. “This is not dependent on when you submitted a return, or when the tax office issued an assessment. Instead, it involves a strict relationship between what tax year the liability occurred in, and what year’s rental income it can be deducted against. These two must match completely,” Matthew says.

The timing of land tax liability differs from state to state. In many states, the liability is for the period during which the owner used the property to generate rental income. “A land tax assessment can be made, and an arrears land tax assessment issued, but this might not be done in the same year during which you were renting the property out to tenants,” Matthew explains.

If an owner receives an arrears land tax assessment and pays the arrears, the land tax deduction must be against the rental income for the same year the arrears tax assessment in which it refers. So if the arrears assessment refers to rental income earned in 2017, an owner can only deduct it against that year’s income, even if the assessment was only issued, and paid, during 2019.

If the investor sells the property, and there is a land tax adjustment, the owner will need to declare the amount they get back as an income for the year in which this pay-out is received.

Matthew says, legal expenses are deductible for the costs incurred for evicting a non-paying tenant; the legal fees for court action for loss of rental income; and defending damages claims for injuries to a third party incurred on a rental property.

Other legal expenses relating to the purchase or sale of the property and defence of a title deed, are deemed of a capital nature and so are not deductible.

Mortgage discharge expenses generally involve penalty interest payments for discharging, or paying off, the mortgage early. This penalty interest is deductible if a mortgage secured the money loaned to purchase the rental income property, and the owner’s ability to pay the mortgage off would be affected by the inclusion of penalty payment for doing so.

Matthew says, “The mortgage discharge expense is also deductible if the penalty interest payment was made to free the taxpayer of having to continue to pay interest on the loan.”

RELATED ARTICLE: Sydney Aged Care Property Acquisition Tax Expert Explains Why Property Owners Claim On Borrowing Expenses Matthew Mousa of TLK Partners Sydney

“Investors must maximise their investment portfolio, and the best way to do that is by leveraging legal taxation deductibles, that is our daily occupation,” Matthew concludes.

TLK Partners Wealth Management Companies Kingsgrove, Beverly Hills | Tax Accountant & Agent | Property Adviserare financial management, retirement planning and wealth advisers serving enterprises and private individuals who hope to take care of their future through sound financial management. Visit their website or contact them at (02) 8090 4324 for an appointment to discuss your financial management and investment needs.

This material is of a general nature only, it does not take into consideration your financial circumstances, needs or objectives. Before making any decision based on this content, you should assess your own circumstances, seek professional advice or contact our office to be directed to the appropriate professional. Whilst all care has been taken in presenting the material neither TLK Partners or its associated entities guarantee that the material is free of error and, the information may have changed since being published.

Syndicated by Baxton Media, the Market Influencers.

Contact Info:
Name: Matthew Mousa
Email: Send Email
Organization: TLK Partners
Address: 1-5 Commercial Rd, Kingsgrove, NSW 2208, Australia
Phone: +61-1300-724-017
Website: https://tlkpartners.com.au/

Source: NewsNetwork

Release ID: 512386

More News From The Sport Ship

Turkey's Erdogan witness in footballer Mesut Ozil's wedding

Jul 20, 2019

ISTANBUL — Turkey President Recep Tayyip Erdogan was in the wedding party as Arsenal midfielder Mesut Ozil tied the knot on Friday. State-run Anadolu news agency said Erdogan and his wife, Emine, were legal witnesses for Ozil, who married model, actress and former Miss Turkey Amine Gulse in Istanbul. Secular Turkish weddings require a witness each for the bride and groom. Ozil, a German player of Turkish descent, quit Germany's soccer team last year after he was criticized for posing for a photograph with Erdogan before the World Cup. In his international retirement announcement, Ozil accused the German football federation,...

Pant helps Delhi eliminate Hyderabad from IPL

Jul 20, 2019

VISAKHAPATNAM, India — Rishabh Pant hit a blistering 49 off 21 balls as Delhi Capitals notched a thrilling two-wicket victory against Sunrisers Hyderabad in the Indian Premier League Eliminator on Wednesday. Pant smashed five sixes and two fours in Delhi's first IPL play-off in six years which carried them to 165-8 when Keemo Paul struck a winning boundary on the penultimate ball of their run-chase. Hyderabad had earlier scored 162-8 despite their two key players — Englishman Jonny Bairstow and Australian David Warner — being back with their respective national teams for World Cup preparations. "If you try to stop...

Czech international Sural killed in auto crash in Turkey

Jul 20, 2019

ANKARA, Turkey — Czech Republic international Josef Sural was killed and six other Alanyaspor players were injured on Monday when their van crashed on the way home from a Turkish league soccer match. The 28-year-old Sural died in the hospital during emergency surgery, Alanyaspor president Hasan Cavusoglu told NTV television by telephone. The six other players were reported to be in stable condition. Cavusoglu said Sural and his six teammates hired a private luxury van to return from a game at Kayserispor in central Turkey. The crash occurred near the entrance to the town of Alanya, on Turkey's Mediterranean coast....

Shadab Khan ruled out of series against England with illness

Jul 20, 2019

ISLAMABAD — Pakistan leg spinner Shadab Khan was ruled out of next month's one Twenty20 and five-match one-day international series against England due to illness on Sunday. Leg spinner Yasir Shah, who has taken 23 wickets in 24 ODIs, will replace Shadab for the series, which begins May 5 with the only Twenty20 game at Cardiff on May 5. The ODI series starts May 8. "The tests revealed a virus that will require treatment and rest for, at least, four week," the Pakistan Cricket Board said in a statement on Shadab. The PCB didn't reveal the exact nature of Shadab's...

Widows, ace guide to climb Everest to honor Sherpas

Jul 20, 2019

KATHMANDU, Nepal — Five years after one of the deadliest disasters on Mount Everest, three people from Nepal's ethnic Sherpa community are preparing an ascent to raise awareness about the Nepalese mountain guides who make it possible for hundreds of foreign climbers to scale the mountain and survive. Kami Rita, a renowned climber who lived through the 2014 ice avalanche on Everest's western shoulder that killed 16 fellow Sherpa guides, aims to break his own record by reaching the mountaintop a 23rd time this spring. Furdiki Sherpa, who lost her husband in a mountaineering accident, and Nima Doma, whose husband...

About Us

We’re all about evolving the love of sports. With The Sport Ship, you can up your game and receive all the latest news about the sports world before anyone else.

Contact us: sales[at]thesportship.com

Subscribe Now!