Investing in property?

The ATO has reminded taxpayers in a property business or thinking about investing in property that there are things they should know.

Such as:

they need a clearance certificate from the supplier when buying property over $750,000;
they may have to pay the GST on the sale of brand new residential property separately to the ATO; and
income from property activities could increase their total business turnover.

The ATO says tax time can be made easier by keeping accurate and complete records for the period the taxpayer owns the property and they are:

renting it out as a residential property (even short-term through the sharing economy);
flipping houses; and/or
building a new house to sell for a profit.

In addition, when it’s time to lodge, taxpayers should remember:

Some expenses need to be claimed over time (such as borrowing costs or capital items like dishwashers), or can be claimed as an immediate deduction (such as interest on loans and insurance).
It is only possible to claim expenses for:
- periods when the property is genuinely available for rent; and
- travel related to renting property, if the taxpayer is in the business of letting properties.
They should check if they are eligible for CGT concessions.