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The ATO has issued a rental property owners toolkit, amid increased mistakes in tax returns.
In a recent review of individual tax returns, the ATO found that nine out of 10 taxpayers with a rental property made mistakes in their tax return.
To help tax agents and their clients get the information they need to lodge correctly, the Tax Office has developed a new toolkit for rental property owners.
The toolkit focuses on areas where mistakes are commonly made, including interest on a loan taken out to purchase a rental property; borrowing expenses incurred when taking out a rental property loan; repairs, maintenance and capital expenditure; and renting out a room, a unit or a whole house on an occasional basis through the sharing economy.
According to the ATO, keeping the right records over the period you own a property will help you claim all of the deductions you’re entitled to at tax time. Records include contract of purchase and sale; proof of all income and expenses; periods of private use by you, your family, or friends; loan and refinancing documents; and evidence of steps you took to rent out your property.
You can download the rental property owners toolkit here.