Property Tax
Owning an investment property means that you’ll be receiving a rental return, which will add to your overall taxable income. With some helpful property tax tips, you may be able to reduce your tax bill by understanding which deductions you are eligible for.
Types of Property Tax
Generally there are two key tax liabilities when it comes to property:
- Rental returns adding to your taxable income
- Profit made once you sell the property triggering a Capital Gains Tax liability.
Can I Reduce My Property Tax?
While the rental income you receive may significantly increase your taxable income, there are a lot of deductions available to investors.
In fact, it’s possible for your tax deductions to outweigh the income received from the property. In these circumstances, the property is said to be negatively geared.
Property Tax and Depreciation
One of the greatest property tax tips we can give you, is to make sure you are claiming the maximum depreciation deductions allowable.
This tax deduction is said to be ‘non-cash’. This means you don’t have to spend any more money each year to claim it.
A tax depreciation schedule could save you thousands of dollars each year.
