Rental Property Tax Deductions Made Easy

Published April 2025

Investing in property? Good on ya. But let’s make sure you’re not leaving cash on the table at tax time. Whether you’re a seasoned landlord or you’ve just jumped into the rental game, knowing what you can (and can’t) claim is the key to winning the refund jackpot.

And with Gotax.com.au, we’ve made it dead simple—even if you only own part of the property.

⚡ Summary

Own a rental property in Australia? Want to know which rental expenses are tax deductible, how depreciation works, or what happens when you split ownership? This blog breaks down everything from mortgage interest to land tax, borrowing costs, and legal fees. Plus, we’ll show you how Gotax automatically handles shared ownership for stress-free tax returns. Forget boring accountants—GoTax is where refunds get real.

What You Can Claim as a Rental Property Deduction

Interest on Your Mortgage

That big scary mortgage? You can’t claim the repayments—but the interest bit? That’s fair game.

Repairs and Maintenance

Fixing broken tiles, plumbing dramas, painting—if it's keeping the place rentable, it's deductible.

Insurance

If you’ve got landlord or building insurance, claim it. You’re protecting an income-generating asset.

Utilities

Paying water, gas, or electricity for the tenant? Yep—deduct that too.

Professional Services

Property managers, real estate agents, and tax agents (hi, that’s us ????) are deductible.

Advertising for Tenants

Trying to fill the vacancy? Claim that online ad.

Travel Expenses

Driving to the property for inspections or repairs? Log those k’s—every trip counts.

Depreciation

Claim wear and tear on both the building and assets inside it. This is where the real refund juice is.

Borrowing Costs

Loan setup fees, valuations, LMI—you can’t claim them all in one hit, but you can spread the deduction over 5 years.
 

Borrowing Costs Explained

Borrowing costs are everything the bank stings you for when you take out a loan:

• Loan establishment fees

• Valuation fees

• Lenders Mortgage Insurance (LMI)

• Title & mortgage registration

Example: Spent $3,000 setting up your loan? Deduct $600 a year for 5 years.

What You Can’t Claim

• ❌ Using the property yourself for a holiday

• ❌ Renovations or upgrades like a new kitchen (that’s capital, not repairs)

• ❌ Late payment fines or penalties

• ❌ Legal costs for buying the property

Land Tax – You Might Be Missing This One

Yep, land tax is deductible if the property’s rented out. Check your state or territory’s rules and thresholds here:
State-by-State Land Tax Info – ATO

⚖️ Legal Fees – The Good, the Bad, and the Deductible

Claimable:

• Preparing lease agreements

• Kicking out bad tenants

• Defending ownership

Not claimable:

• Legal fees for buying the property

• Conveyancing during settlement

Gotax Tip: Use 100% Figures—We’ll Do the Apportioning

Own just 50% of a property? 25%? Doesn’t matter.
In Gotax, you enter:

✅ 100% of the rent
✅ 100% of the expenses

We handle the maths. We automatically calculate your share and include that amount in your tax return.
Zero confusion. Zero errors. Maximum refund.

Start here www.gotax.com.au

 Real Examples

• ✅ Claimable: $1,200 plumbing fix – deduct the lot.

• ❌ Not claimable: $10k kitchen upgrade – depreciate it over time.

• Borrowing Costs: $3,000 setup = $600/year over 5 years.

How Depreciation Works

Bought for $300,000
Land worth $50,000
= Depreciation base: $250,000
= Deduct ~$9,091 each year over 27.5 years

Don’t forget: If you sell the property, the ATO might hit you with recapture tax on depreciation you’ve claimed.

Quick FAQs

Can I claim land tax on my rental?

Yes, if the property is producing income.

Do I include 100% or just my share of the expenses?

Enter 100%—Gotax calculates your share.

Are borrowing costs fully deductible in year one?

Nope. They’re spread out over up to 5 years.

What’s the difference between repairs and improvements?

Repairs fix something broken = deductible.
Improvements add value = capitalised and depreciated.

Final Thoughts from Derek

Rental property tax isn’t scary—it’s a refund opportunity in disguise. The trick is knowing what’s deductible, what’s not, and using a system (like Gotax) that does the heavy lifting for you.

We don’t just crunch numbers—we help you claim every cent you’re entitled to.

Ready to get started?
Start your rental property tax return now at: https://www.gotax.com.au/rental-pricing