Fo­cus on hol­i­day home rentals

Wangaratta Chronicle - North East Regional Extra - - News -

THE Aus­tralian Tax­a­tion Of­fice (ATO) is set­ting its sights on the large num­ber of mis­takes, er­rors and false claims made by rental prop­erty own­ers who use their own prop­erty for per­sonal hol­i­days.

“The ATO is fo­cus­ing on tax­pay­ers who claim de­duc­tions for hol­i­day homes that are not ac­tu­ally avail­able for rent or only avail­able to friends and fam­ily,” as­sis­tant com­mis­sioner Kath An­der­son said.

“While pri­vate use by fam­ily and friends of a hol­i­day home is en­tirely le­git­i­mate, it does re­duce your abil­ity to earn in­come from the prop­erty.

“This in turn im­pacts the de­duc­tions you can claim.

“You can only claim de­duc­tions for your hol­i­day home if your prop­erty is gen­uinely avail­able for rent.

“You can­not claim for times when you were us­ing it for your own per­sonal hol­i­days or let­ting friends and fam­ily stay rent-free.

“It’s not ok to ex­pect ev­ery­one else to pay for your hol­i­day.

“Hol­i­day home own­ers also need to re­mem­ber that if their prop­erty is rented to friends and fam­ily at mates rates, they can only claim de­duc­tions for ex­penses up to the amount of the in­come re­ceived.”

Be­sides hol­i­day rentals, the ATO is also fo­cused on other times when a prop­erty is not rented or gen­uinely avail­able for rent. Ms An­der­son said some tax­pay­ers claim their prop­erty is avail­able for rent, but when the ATO in­ves­ti­gates, it is clear they have lit­tle in­ten­tion of rent­ing it out.

“We see things like un­rea­son­able con­di­tions placed on prospec­tive renters, rental rates set above mar­ket rates, or fail­ing to ad­ver­tise a hol­i­day home in a way that tar­gets peo­ple who would be in­ter­ested in it,” Ms An­der­son said.

“In­cor­rect rental prop­erty claims will not go un­no­ticed.”

Ms An­der­son said all rental prop­erty own­ers should dou­blecheck their claims be­fore lodg­ing their tax re­turn, even if sub­mit­ting through a tax agent.

“Make sure that you de­clare all rental in­come and only claim de­duc­tions for pe­ri­ods that the prop­erty is rented or was gen­uinely avail­able for rent at mar­ket rates,” she said.

“Be sure to keep ac­cu­rate records of the in­come you re­ceive from your rental prop­erty, ex­penses you in­cur, and ev­i­dence of the prop­erty be­ing rented or gen­uinely avail­able for rent at mar­ket rates. You should also records of who stayed at the hol­i­day home and when, in­clud­ing the time you and your fam­ily stay at the prop­erty.”

For more in­for­ma­tion on hol­i­day homes, visit ato.gov.au/hol­i­day­homes

For more gen­eral in­for­ma­tion on rental prop­er­ties, visit ato.gov.au/ rental.

GET­TING AWAY: Keep an eye on your de­duc­tions when claims are re­lated to your hol­i­day home.

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