National firm MCG Quantity Surveyors have identified five moves property investors can make immediately to help deliver a much-needed cashback tax boost in these tough economic times.<\/p>\n
Mike Mortlock, managing director of MCG, said that these tasks could ease an investors hip-pocket burden while improving their property\u2019s value.<\/p>\n
\u201cIf property investors were intending to carry out some of these actions on their investment, but hadn\u2019t got around to doing them yet, my suggestion is that they tackle them immediately,\u201d he said.<\/p>\n
\u201cMaking these easy moves now will maximise your tax return, a much-needed boost given challenges around the rising cost of living.\u201d<\/p>\n
Mr Mortlock said increased interest rates, cost-of-living pressures and rising construction costs would be reasons why investors should get savvy about their EOFY financials.<\/p>\n
\u201cOur research shows investors are becoming more prudent about their financial arrangements, and their level of engagement is only set to ramp up as fiscal pressures force us all to look at ways of maximising our bank balances,\u201d he said.<\/p>\n
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Tackle niggling repairs and maintenance <\/strong><\/p>\n Mr Mortlock said small repairs and maintenance carried out now will be immediately claimable.<\/p>\n \u201cOur company\u2019s most recent 1000 Assets report shows around one-third of all investment properties receive post-purchase renovation work, with an average spend of around $25,000 to $30,000 per property,\u201d he said.<\/p>\n But even small works can deliver a benefit.<\/p>\n \u201cI\u2019m talking about those minor works you\u2019ve been putting off, any repair, no matter how small, allows you to claim the cost of materials used to tackle it,\u201d he said.<\/p>\n \u201cAlso, labour costs are claimable if you use a contractor. Works can include landscaping, something that landlords may be able to carry out themselves with the tenant\u2019s permission.<\/p>\n \u201cNow is the time to act because any costs you incur in June are 100 per cent tax deductable in July.\u201d<\/p>\n Pay your loan interest in advance <\/strong><\/p>\n Mr Mortlock said in 2022 if you have the means to pay your annual interest bill in advance, it should be a consideration.<\/p>\n \u201cAussies have managed to boost their saving throughout the pandemic with increases in their offset accounts and savings,\u201d he said.<\/p>\n \u201cI\u2019d suggest devoting some of that treasure chest toward pre-paying your interest bill for the coming year, the sum you pay is immediately claimable against your 2020\/21 tax return.\u201d<\/p>\n Get a depreciation schedule <\/strong><\/p>\n Depreciation schedules prepared by suitably qualified professionals assign hugely advantageous tax-deductible depreciation to your property\u2019s fixtures, fittings and finishes.<\/p>\n \u201cIf you haven\u2019t already organised for a depreciation schedule, then get onto it today!\u201d Mr Mortlock said.<\/p>\n \u201cFortunately, investors are becoming more aware of their advantages.<\/p>\n \u201cOur most recent 1000 Assets report revealed the amount of time between settlement and ordering a schedule fell to around eight months in 2022, more than half the time it was in 2016.<\/p>\n \u201cFor just a few hundred dollars a deprecation schedule can deliver thousands back to the landlords, that\u2019s an incredible return on investment.\u201d<\/p>\n Purchase items for your property <\/strong><\/p>\n While having items fully installed before the end of the year might be a challenge, there is nothing stopping landlords from buying freestanding items that contribute to the rent return.<\/p>\n \u201cLook to purchase items that are either free standing or can be quickly installed,\u201d Mr Mortlock said..<\/p>\n \u201cMaybe it\u2019s a matter of selecting some light fittings or blinds this weekend and getting then in place.<\/p>\n \u201cYou could choose rugs or even pay in advance for tiles and carpet.<\/p>\n \u201cYou could also purchase things like pot plants and other garden ornaments, or freestanding lamps, appliances such as a new chest freezer.<\/p>\n \u201cAll things that will be used by the tenant, help boost the rent and can be deductible.\u201d<\/p>\n