There are only two certainties in life, death and taxes.

While people often try to avoid both for as long as possible, tax time comes around a lot more often than the former.

The good news is that you can make it a lot more interesting once you know the full extent of your deduction ability.

If you have recently purchased an investment property, you will find that ability has received a considerable boost, to propel you from tax-adaisical, to a weapon of mass deductions.

Here is a look at some of the most common and straightforward deductions you can claim, starting with interest.

As long as your property is available for rent, that is, not being used to house grandma or your Gen Y kids for free, the interest you pay on your loan is deductible.

However, if you are using it for private purposes, say a beach holiday, the interest is ineligible to be struck off by your accountant.


Next, your tenancy costs are also tax deductible.

These include the cost of advertising for tenants, landlord insurance premiums and expenses incurred while travelling to inspect the property.

Be warned about the latter though, the ATO is keeping a keen eye on people who might head on up to the Whitsundays and spend two weeks “inspecting their investment property.”

If you do claim such an expense, you can only claim a portion of your trip.

Repair costs, which can really add up if you have a strata property, are tax deductible, providing the damage occurred after the property was purchased.

You can’t simply kick a bunch of termites out of their home and then hit the tax man up for the damages.


Likewise, improvements are not eligible, so that new swimming pool or covered ‘al fresco’ deck with inbuilt barbecue will have to come out of your own hip pocket.

Finally, there are plenty of holding costs that can be deducted, such as body corporate fees, cleaning and gardening costs, building and contents insurance premiums, rates, security monitoring, pest control and property manager’s fees.

If unsure, double check everything with a tax professional so you don’t miss out.

Tim McIntyre is the senior real estate reporter for the Daily Telegraph and

Over the past decade, he has attained widespread knowledge of Australia’s many unique property markets and is an authority on all things buying, selling and investing.

His commentary appears every Saturday in the Daily Telegraph Real Estate lift out, as well as online at


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