• Video transcript - Introduction to rental property and tax

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    To see the video of this transcript, go to Introduction.

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    Host

    Buying and owning a rental property can be an exciting time.

    Whether you’re thinking of buying a rental property, renting out your current property, or thinking of selling it, you need to understand your tax obligations.

    In this series, we’ll meet rental property owners who’ll share their knowledge and experiences with you, just like Michael…

    Michael Lo

    Two words – record-keeping! You know – receipts, contracts, that sort of thing. It will save you time, money and all sorts of hassles. Keeping proof of my expenses means I can claim everything I’m entitled to.

    Host

    We’ll talk about the rent that you have to declare in your tax return.

    As well as handy tips – for example did you know that when you sell your property, you might be eligible for a 50% discount on the profit you declare in your tax return? Or, as Phil and Sara found out…

    Phil Hitchman

    We can claim immediate tax deductions on things such as interest on the loan, council rates, repairs and maintenance.

    And for assets that wear out slowly, such as a hot water system and stove, and even the building – we can claim over a number of years.

    Sara Hitchman

    The cost of the property and things such as legal fees and stamp duty when buying and selling property are used to work out if we made a profit: known as a capital gain - when we sell it.

    Phil Hitchman

    And when you have work done to your property, make a note of whether the work is a repair or an improvement. Repair costs can be deducted in the year that they occur, but improvement costs may be deductible over several years, or used when working out your capital gain.

    Host

    I’m sure you have plenty of questions about owning a rental property, like what happens when you rent for part of the year, or only rent out a part of your property? Or which expenses you can and can’t claim? Or what happens when you decide to sell?

    For answers to these and all your other questions, join us on our Rental properties and tax videos.

    For more information about tax and your rental property, and to watch our series of videos, visit ato.gov.au/rental

      Last modified: 06 Mar 2015QC 40937