What Can I Claim - Rental Properties

If you own a rental property, all income earned throughout the financial year must be declared in your Income Tax Return. At the same time, you’re entitled to claim deductions on expenses incurred, provided the property was rented or genuinely available for rent during that period.

Let’s break down exactly what landlords can and can’t claim, and how to stay on the right side of the ATO.

Expenses You Can Claim Immediately

These expenses can be deducted in the year they were incurred:

• Advertising for tenants

• Bank fees and charges

• Borrowing costs such as loan establishment fees

• Council rates

• Cleaning services

• Insurance (including building, contents, landlord)

• Interest on loans used for the property or related assets

• Land tax

• Legal expenses relating to tenancy disputes (not purchase costs)

• Pest control

• Phone charges for managing the property

• Real estate agent fees and commissions

• Repairs and maintenance (not initial repairs at purchase)

• Stationery and postage for communication with tenants

• Travel to inspect or maintain the property or collect rent

• Water rates

❗ If your property was only rented for part of the year, you must apportion the expenses based on the time it was available.

Expenses Claimed Over Several Years

Some expenses must be depreciated or spread out:

• Loan establishment costs – claim over 5 years

• Depreciable assets – e.g., appliances, furniture

• Construction costs – typically 2.5% per year for eligible properties

What You Can’t Claim

Certain costs are excluded from immediate deductions:

• Private use expenses – any portion of the property used personally

• Tenant-paid expenses – bills your tenants covered

• Costs of buying/selling the property – stamp duty, conveyancing, initial repairs

  These may instead form part of your cost base for capital gains tax (CGT) purposes.

• Initial repairs – if carried out right after purchase to fix existing problems

💡 Only expenses related to the rented part of your property can be claimed. If you rent a room or part of your home, only claim expenses relevant to that portion.

Record Keeping Requirements

You need to keep adequate records to support your claims:

• Rental income and expenses – keep records for at least five years after lodging your return

• Ownership documentation – including purchase and sale contracts, and records of capital improvements

Digital receipts and scans are fine, but make sure they’re legible and securely backed up.

Need Help With Your Rental Property Tax Return?

At Dolman Bateman, we specialise in helping property investors across Australia get their deductions right—while staying compliant. Let us help you maximise your return with confidence.

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Disclaimer:

The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. While every effort has been made to ensure the accuracy of this content at the time of publication, tax laws and regulations may change, and individual circumstances vary. Dolman Bateman accepts no responsibility or liability for any loss or damage incurred as a result of acting on or relying upon any of the information contained herein. You should seek professional advice tailored to your specific situation before making any financial or tax decision.