Tag Archives | brisbane rentals

Writing it Down Keeps You in the Clear, Keep Records…

Writing it Down Keeps You in the Clear, Keep Records...
The importance of accurate record keeping cannot be over-estimated when dealing with investment property. Due to the complexity of taxation laws in relation to property investment it is advisable to update records with regularity.

Property investors should create a habit of analysing their investment at least quarterly. That would include reviewing records of income, expense and repairs or improvements.

The ATO have the power to ask questions in relation to your investment property and your income. It is wise to ensure that all documentation is accurate and available. After all, who really wants an audit?

First time property investors need to know the types of documentation that needs to be maintained and the very first thing that an investor should acquire is a depreciation schedule from a quantity surveyor. This is a document that justifies claims in relation to depreciation and improvements to the property.

Records that savvy property investors maintain include:

  1. Depreciation schedule.
  2. Loan documents and statements detailing interest payments.
  3. Records of solicitor and accountant fees and statements.
  4. Monthly rental statements from agent.
  5. Copies of receipts for expenses such as rates, cleaning, agent’s fees.
  6. Bank statements.
  7. Records in relation to any costs of improvements.
  8. Records in relation to any expenses.

Maintaining accurate records and filing them correctly can save you a lot of grief at a later point in time.

If you are considering purchasing an investment property or would like to have yours managed please contact us we would love to assist you!

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What To Do if You’re Audited

All Australians dread the thought of an A.T.O. audit, and property investors are no different. Here are some tips should you ever endure such an unfortunate event.

  • Don’t panic. Most audits are triggered due to a minor anomaly. You are innocent until proven guilty.
  • If you have done the wrong thing, fess up and limit the damage and penalties.
  • Keep receipts and have them ready for the tax office.
  • Make sure you have a depreciation schedule from a quantity surveyor for each of your investment properties.
  • Have a 13-week log book for motor vehicle expenses.
  • Seek professional advice from a tax lawyer/accountant that has experience in tax audits.
  • Prepare documents in advance – bank statements, records, invoices and receipts.
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The Ups and Downs of Rental Properties and Minimising your Losses

We all love it when we own a rental property and all’s going well. When the tenant is paying on time and looking after the place and no repairs are required and the property is going up in value – we wish we had another ten properties! But when things are not going so smoothly it is a different story!

This month we have lived through the frustrations of things not going well for one of our owners and I would like to share some of the learning’s from this experience for everyone to consider.

1.       Furnished properties – not something I would consider or recommend. If something like a fridge breaks down, no matter how new it was, you will need to replace or fix it. And if any of your furniture is damaged accidentally it is unlikely your insurance will cover you. As one of our owners discovered this month.

2.       Landlord Protection Insurance – Please check your policies!! There are so many different policies and exclusion clauses you need to be sure that the policy you have will protect you for what your needs are: such as loss of rent if the tenant is behind. You don’t want to find that your policy only covers you if your tenant is more than 5 weeks behind as this owner did! Also, you need to be covered for accidental damage. It is rare that tenants intentionally damage your property and it is more likely to be accidental so check that you’re protected.

No one likes it if a tenant does not pay rent on time. If the problem becomes a consistent one than you need to strongly consider if you want to continue the frustration of not knowing when you will receive your rent. Unless your property is hard to rent (in which case you need to consider other factors) I highly recommend giving the tenants notice (two months) at the end of their lease and finding another tenant. I would also recommend that you give notice to vacate if breach notices are not remedied by the due date to minimise your loss of rent. Failure to do so can also void your insurance policies.

The above comments may seem hard and please be sure that I empathise with any tenant or landlord going through difficult times. We do not want to see any of our customers and clients in this situation. However,in acting for you, our landlords, it’s important to me to provide you with advice that will protect your interests.

Christina

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