The Australian Tax Office (ATO) has recently released the 2015 Rental Property Owners Guide. This contains a large amount of information relevant to investment owners including what income and expenses you have to declare on your tax return and what deductions you can claim. Here are a few points of interest:

What do you have to disclose?

  • Rental income
  • Products or services received in lieu of rental income. e.g. you rent your house to a friend, but he had no cash to pay the rent, instead, he bought furniture to put in the house, that furniture can be treated as rental income.
  • Bond retained from tenants as the result of property damage or defaulting on rent payments.
  • Payment received from tenants to cover damage to property.
  • Insurance payouts. e.g. compensation payments from homeowners insurance.
  • Government incentives/rebates. e.g. for the installation of a solar power system etc.

What can’t you claim?

  • Expenses incurred in the disposal or acquisition of property.
  • Expenses you are not required to pay. e.g. water or electricity expenses borne by tenants
  • Expenses incurred during a period of self occupancy.
  • Expenses incurred while buying a property. e.g. travel costs and inspection fees.
  • Expenses from process of finding a property.e.g. rental seminars.

What can you claim immediately?

  • Advertising costs for acquiring tenants
  • Bank charges
  • Body corporate fees and charges
  • Cleaning
  • Council rates
  • Electricity and gas
  • Water charges
  • Gardening and lawn mowing
  • Audio & video service charges
  • Insurance
  • Interest on loans
  • Land tax
  • Lease document expenses
  • Legal expenses
  • Mortgage discharge expenses
  • Pest control
  • Property agent fees and commission
  • Quantity surveyor’s fees
  • Repairs and maintenance
  • Secretarial and bookkeeping fees
  • Security patrol fees
  • Stationery and postage
  • Telephone calls
  • Tax-related expense
  • Travel and vehicle expenses

What can you claim by instalment?

  • Borrowing expenses, including loan establishment fees, title search fees, valuation fees, mortgage insurance.
  • Amounts for decline in value of depreciating assets
  • Capital works deductions: 4% depreciation rate for the properties purchased before 16th September 1987, 2.5% for the purchases after that.


To get your copy of the guide for rental property owners, simply visit the ATO website – it is free to download.

If you have any questions in regards to your tax return feel free to contact me at or call (07) 5444 1022 to make an appointment to meet with one of our friendly team.

Ricki Liang