TRAVEL DEDUCTIONS – Investment property

One of many areas that the Australian Taxation Office is targeting and changing are deductions regarding Travel, whether they be log book or cents per kilometre methods.

The ATO are now specifically cracking down on travel deductions for Investment Properties. New legislation has been introduced as of 1 July 2017, which states that taxpayers are no longer able to claim any deductions for the cost of travel relating to a residential rental property, this includes but is not limited to KM’s travelled to view the property. They may only claim travel deductions if they are carrying on a business of property investing or are an excluded entity.

A residential premise (property) is land or a building that is:

  • Occupied as a residence or for residential accommodation.
  • Intended to be occupied, and is capable of being occupied, as a residence or for residential accommodation.
travel deductions - investment property

Example: An individual with residential investment property in 2017–18

Sarah rented out her residential rental property in 2017–18. She travelled to the property to repair damages caused by tenants during the year.

As the investment is a residential property, Sarah cannot claim travel expense.

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