Guide to property

Expenses you can claim

You can claim a deduction for certain expenses you incur for the period your property is rented or is available for rent.

Apportionment of rental expenses

You can claim only part of the expenses if the property is available for rent for only part of the year, or only part of it is used to earn rent, or you charge non-commercial rental rates.

Expenses you can deduct in the income year incurred

Generally you can claim an immediate deduction for expenses related to the management and maintenance of the property, including interest on loans.

If your property is negatively geared - that is, you borrowed money to buy the property and your net rental income after other expenses is less than the interest on the loan - you may be able to claim the full amount of rental expenses against your other income, such as salary and wages.

Expenses deductible over a number of income years

Some expenses are claimed over a number of years, such as the decline in value of carpet, furniture and appliances, and certain construction expenditure.

You can't claim: acquisition and disposal costs of the property - instead, these are usually included in the property's cost base for capital gains tax purposes expenses not actually incurred by you, such as water or electricity charges borne by your tenants expenses that are not related to the rental of a property, such as expenses connected to your own use of a holiday home that you rent out for part of the year GST credits for anything you purchase to lease the premises - GST doesn't apply to residential rental properties.

Property - home

Sections within Expenses you can claim

• Apportionment of rental expenses
• Expenses you can deduct in the income year incurred
• Expenses deductible over a number of income years