You need to maintain records for holiday homes or residential properties you rent out, intend to rent out or make available for rent. You’ll need these records to know how much:
- the rental income you are required to declare
- you are allowed to claim a deduction for your expenses
How Long to Maintain Rental Records?
You have to maintain records for at least five years. Based on your situation, that is five years from the date:
- you file your tax return
- of your last claim for the decline in the asset’s value
- you resolve any challenges you have with ATO
- it is certain that no CGT event can occur after you obtain, sell or dispose of the property.
Types of Rental Records that Need to be Maintained
You need to keep a record of your holiday home or rental property:
-
Rental Income
Records of payments that you receive, including
- a statement from your managing or property agent
- a bank statement or rent book that demonstrates the rental payments flowing into your account
- documents that demonstrate a record of any bond money you keep in place of rent
-
Rental Expenses
Records for expenses that you incur, such as:
- loan documents
- land tax assessments
- bank statements that demonstrate the interest charged on borrowed money for rental property
- receipts or documents that show the amounts you pay for
- bank charges
- gardening
- property agent fees
- repairs or maintenance
- council rates
- advertising
- documents that show expenses detail related to:
- the decline in depreciating assets’ value
- any capital work expenses
- travel expense documents, if you qualify to claim travel and car expenses such as:
- travel diary that shows types of activities, places, dates, times of activities and travel (you need to have this if you travel away from home for six or more than six nights)
- receipts for fuel, flights, meals, accommodation, and other expenses while travelling
- receipts for items you utilise for maintenance and repairs that you purchased when you stayed near or travel to, the rental property.
-
When You Purchase a Rental Property
Records when you invest in or buy a rental property, such as:
- contract of purchase
- loan documents
- expenses to buy the property
- conveyancing documents
- borrowing expenses
-
While You Own a Rental Property
Records to keep while you own a rental property, such as:
- tenant leases
- receipts, documents and before and after photos for improvements in capital
- loan documents in case you refinance your property
- documents that demonstrate time of personal use by you or your friends
- documents that demonstrate the time when the property is used as your main residence.
-
When You Sell Your Rental Property
The following records you need to maintain when you sell a rental property:
- contract of sale
- sale of property fees
- conveyancing documents
- calculation of capital gains or losses.
Records for Several Properties
You need to maintain a separate record for each property, if you have:
- a duplex
- more than one property
- sub-divided property
It will ensure that if you later sell one or part of a property, you’ll still have proper records to opt for claims.
Conclusion
The blog shares different types of rental records that you need to maintain for at least 5 years. For further details, you can seek help from Reliable Melbourne Accountants.