Common Tax Reporting Mistakes
January 22, 2009 | admin | Comments 0
The Australian Taxation Office (ATO) has highlighted the following as common mistakes Property Investors make and are important reminders of the kinds of issues they monitor:
- Claiming deductions for rental properties not genuinely available for rent (to be deductible the property must be available for rent – ie. usually excludes construction/renovation periods)
- Incorrectly claiming deductions for properties only available for rent part of the year, for example a holiday home
- Incorrectly claiming the cost of structural improvements as repairs when they are capital works deductions, such as remodelling a bathroom or building a pergola, and
- Over stating deduction claims for the interest on loans taken out to purchase, renovate or maintain a rental property. A loan can be taken for both income-producing and private purposes, like to buy a car or go on an overseas holiday. The interest on the private portion of the loan is not tax deductible. An apportionments of loan interest must be calculated where the loan has multiple purposes.
Post by Guest Writer David Maynard – CEO of My Tax Zone
Filed Under: Tax Tips
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