For those with investment properties the new financial year can mean a rush to get your tax sorted and (hopefully) refunds received. But a lot of investors may not know just what or how much they can claim as deductions linked to their property investments. With a new financial kicking off, it is a great time to take the right steps to be in the best position on July 1st next year.

Keep all the receipts!

It can be hard to remember every expense over a year, so keeping details and a paper trail of everything is the first important step. There are around twenty different expenses that you can claim, including interest on loans, advertising costs, body corporate fees and legal fees. The Australian Taxation Office website and your accountant will be able to provide a detailed list to help. Expenses on items that you purchased for less than $300 can be claimed as immediate tax deduction, while others may need to be depreciated over a longer period.

Repairs v capital improvements

Expenses for maintenance and repairs are treated differently than those for spending on capital improvement, which are depreciated over a number of years. For example, the costs to repair a fixed structure, such as a carport, can be claimed as an immediate deduction in that financial year. But if the carport needed replacing it would be categorised as an improvement and instead you may be able to claim a percentage of the cost each year over its lifetime.

Seek expert advice

The Australian tax system can be complicated and hard to understand, it is always best to engage professional advice from a tax agent and the Australian Tax Office. If you’re unsure about anything in particular, start your preparation in July so that you are organised when the times comes in 2017.