Rental Property Travel Deductions Are Now Denied

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In line with previous editions of S & W Insight, and as stated in the May budget, travel deductions related to rental properties are currently disallowed, as confirmed by accountants in Sydney.

The new law governing this denial was passed on 15 November 2017, effective 1 July 2017. The law effectively denies most owners of residential properties deductions for travel expenses related to their properties. The law is quite comprehensive in its scope. It covers travel for all purposes, including inspecting, maintaining and collecting rent, and undertaking repairs and maintenance to the property. 

The expenses can then not be capitalised into the cost of the property either. The expenses are disregarded altogether.  

This law is relevant to properties used by the tenant as a place to live. Travel expenses will still be available where the tenant uses the property for business purposes (e.g. full or partial use as commercial premises). Additionally, you can still employ parties to carry out tasks on your behalf (such as real estate agents for property management, inspections etc.). 

If you have any queries, don’t hesitate to contact us to discuss.

Kreston Stanley Williamson Team

*Correct as of November 2017

Disclaimer – Kreston Stanley Williamson has produced this article to serve its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas in this article, you must seek advice about your circumstances. Liability is limited by a scheme approved under professional standards legislation.

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