Common Errors for Rental Property Owners

The ATO’s recent extended data rental property matching program require software providers to provide details of rent and expenses for residential rental properties managed by a property manager.

This information alongside rental data from banks, landlord insurers, rental bond authorities and sharing economy providers (like AirBnB and Stayz) gives the ATO an insight to common errors in respect of investment property reporting.

The key findings in property data matching were as follows:

• Instead of reporting gross rental income and claiming expenses, net rent (after expenses) is reported and the same expenses are claimed a second time
• Properties are being omitted from returns
• Where properties are owned by multiple stakeholders, only one owner reports the property – when both are required to report
• Not reporting the rental income received when purchasing an already tenanted property that the new owner intends on moving in to
• Capital works or depreciating assets being claimed as repairs and maintenance

If you have forgotten to tell us about any rent received or made mistakes with claiming expenses, we urge you to lodge an amendment as soon as possible.

In addition, it is important to keep in mind you need to keep records for 5 years from the date on which the record was prepared or obtained, or from the time the relevant transaction or act was completed, whichever is the later.

If you wish you discuss this with us further, please do not hesitate to contact us.

 

Author

May Aung