What’s new

23 January 2018

Changes to rental property deductions

Changes to Rental Property Deductions

Changes have been made to the allowable deductions for rental properties.

The changes are two fold and take affect from the 1 July 2017:

Depreciation:

• Tax deductions for the decline in value of previously used plant and equipment in rental premises used for residential accommodation are no longer allowed.
• Any new plant and equipment in rental premises used for residential accommodation purchased from 1.7.17 can be depreciated over the effective life of the asset as per previously
• This means:
   o If you purchase a rental property to be used for residential accommodation you cannot continue to depreciate the existing plant and equipment
   o If you purchase a rental property to be used for residential accommodation that is new and the plant and equipment is new you can depreciate the plant and equipment
• The existing Division 43 capital works allowance (Building depreciation continues unchanged)

Travel:

• Previously reasonable travel costs for investors to visit rental properties used for residential accommodation were allowable deductions.
• Travel expenses relating to a residential investment property are no longer deductible.

For a list of deductions available for rental properties please refer to our checklist here.  

 

Liability limited by a scheme approved under Professional Standards Legislation. Liability is limited in those States where a current scheme applies.  

 


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