New year is indeed the time for new beginnings, and what better time to start taking stock of your investment than the start of the year? Starting early allows you to be ready for the next financial year.
So what should you review?
#1 Interest rates
There are so many loan options in the market today so you might want to review these and compare them to your current loan to see if you are getting the best rate.
#2 Your PAYG Tax Variation
If you want to make sure that your PAYG Withholding Tax Variation precisely represents your estimated financial position, January and February is the best time to do a review.
#3 Repairs vs Capital Improvements
Costs for repairs, as long as they are caused by fair wear and tear, are deductible. Take for example, replacing faulty electrical switches because they are worn out due to everyday use.
On the other hand, there are other expenditures that are called capital improvements and are also deductible. However, the deduction is spread over a number of years. These include extensions and alterations, renovations and improvements of the property.
If you wish to have some important repairs done before June 2017, contact your Accountant for assistance and clarification regarding its deductibility. It is necessary for you to always consult and seek clarification before starting any alterations or renovations in order for you to get the best tax effective outcome for your investment property.
When you lease an investment property you can guarantee a deduction for the outgoings, for example, rates and water rates however a lot of investors are not aware that you can also claim depreciation, particularly in older properties.
As a rule, building depreciation can be claimed on any building constructed after the 19th July 1985. In spite of the fact that building depreciation can be claimed on the first cost only, even a building built 20 years back may have a sensible measure of depreciation which can be claimed. Plant and fitting depreciation can likewise be claimed and when you buy the property a quantity surveyor can determine a market value to the plant and fittings.
#5 General Insurance
Given we are in the Summer storm season; it is a good time to survey the level of insurance coverage on your investment properties. Building, contents and landlord insurances are all deductible costs. Nonetheless, you should to be routinely looking into these to guarantee that you have suitable coverage for your property’s needs.