Some Invaluable Tax Tips For Property Investors

Tax tips for property investors come really handy and prove to be an excellent hedge against issues with IRD. The investors can claim discounts for certain expenses when their property is on rent. Further, it helps you to maximize the returns from your rented property.

Vehicle Expenses and Operating Costs

We will talk about some invaluable tax tips for property investors. Basically, you can claim the vehicle and other related travel expenses. These include all the expenses you incur while performing business related activities. After all, your weekly trips for maintenance, inspections etc to different properties often add up. However, keeping a record of all these expenses and details can be tedious. But at the same time, they will also save you a lot of money. You can use the logbook template IRD provides. Apart from that, you can also use IRD’s mileage rate calculator. The kilometer rates are generally published after 31st March at the end of each tax year.

Flight Expenses and Travel Costs

If your trip is for your business purpose, you can count flight tickets as your deduction. Though, you will be asked to provide a genuine proof that will justify your itinerary. Thus, it is imperative to keep the records readily available. They will hence prove the purpose of your travel and any corresponding lead up. It will also confirm that your trip was related to your business. When you fly for making inspections and return your trip is tax deductible. In the meantime, if you extend your trip for any other reason it can impact the deductions. That is to say, only a proportion of the trip will be tax deductible.

Purchases below $1000

Suppose you purchase any assets or chattels which cost less than $1000. That’s something you can claim as a tax deduction for the year you made the purchase. For instance, you got a stove at a cost of $480, you can claim for deduction in the same year. However, if you bought it for $1000, you will have to obtain a depreciated value of it. This simply doesn’t mean you should buy chattels under $1000. But, you should keep this in mind when you plan to spend around $1000 for chattels. The low value asset threshold until 2020 was set at $500. After that it was raised to $5000 temporarily amid the pandemic. Finally, it was reset at $1000 from 17th March, 2021.

Property Magazines, Books, Subscriptions to Associations and Courses

Books, newspapers, magazines, local property investors’ fees etc. are all fully claimable. These are things you buy in order to keep up with everything that goes on in the industry.

Repairs, Maintenance and Improvements

Repairs and maintenance at the properties are tax deductible. However, improvements are not covered under tax deductions. That means changes at the property to improve its condition are considered as improvements. This usually happens when you buy a property that’s in poor condition. In the hope that it looks good, aesthetic improvements are done. This doesn’t mean you should not make improvements as it’s not tax deductible. Renovating a property eventually enhances its overall value. As a result, it attracts the interest of the tenants. Moreover, in future you can also borrow a good amount of money against your property. You can also consider choosing the Auckland property management services for your property.

Chattels Which Are Attached To the Property Cannot Be Depreciated

Another key point is that chattels which are attached with your property can’t be depreciated. This includes the furniture that’s fitted and wardrobes and kitchens. Only the assets which are not connected with your property can be depreciated. To enumerate, you can depreciate things at your property like fences, decks, paving stones and driveways etc. Albeit, it also depends on how they are attached with the property. Apart from that, there are some chattels which are not attached to the property. However, they certainly are an integral part of a property. Without them it won’t be possible for you to rent out your property. In short, they are the toilet and kitchen cabinets (excluding the bathroom cabinets). To sum up, they cannot be depreciated.

Conclusion

In conclusion, we can say these are some invaluable tax tips for property investors that can help you save money. We all know how vital it is to manage our properties well. That is something which involves a considerable amount of money. Above all, properties are the most valuable assets in the contemporary world. Hence, it is indispensable for all to make sure their properties are well taken care of. That is to say, only a professional company would be able to deliver the best services. If you are looking for property management in Auckland, you need not seek anymore.

ProEdge property management is markedly the best in the business. We provide concrete solutions to all your concerns regarding property management. Having extensive market knowledge we offer comprehensive solutions to our clients. Thousands of owners have frequently chosen us as their reliable partners.

You can also get all answers and the best tenants through us if you’re willing to rent out your property. We have assisted so many people and helped them manage their properties impeccably. Our forte is to provide an exceptional property management experience to our clients. As a result, that is something which delivers excellent customer satisfaction. Get in touch with us as it will be our privilege to serve you with the best.

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