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Deductions for property investors: What not to forget this year

Are you a property investor who is looking to get the most out of your tax return? If so, you may be missing out on some key deductions. In this blog post, we will discuss some of the most commonly missed deductions for property investors. Borrowing expenses and Lenders Mortgage Insurance are two of the biggest deductions that are often missed. We will also talk about Land Tax, which is another expense that can be claimed back on your tax return. So, if you are looking to get the most out of your investment and your tax return this year, read on!

The 3 most missed deductions for property investors

1. Borrowing expenses

One of the most commonly missed deductions for property investors, borrowing expenses are deductible over 5 years and equate to all the costs associated with taking out a loan. This can include application fees, valuation fees, and title search fees. If you have refinanced your loan at any point, you can also claim the balance of any borrowing expenses for the old loan. This is a commonly overlooked deduction for property investors, especially those who move accountants or do their own taxes. So now you know, make sure you don’t miss it!

2. Lenders Mortgage Insurance

Another big deduction for property investors is Lenders Mortgage Insurance (LMI). LMI is considered a borrowing expense, not capital, so it can be claimed back on your tax return over 5 years like other borrowing expenses, or the balance immediately if you refinance. In Australia, the rates of people taking out LMI policies is only going up. According to Digital Finance Analytics, the number of LMI policies taken out in Australia rose by 25% from 218,593 in 2019 to 273,473 in 2020. That is a lot of value the banks have seemingly gotten for doing very little. So, if you are one of the many Australians who have taken out an LMI policy, make sure you don’t forget to claim it on your tax return! The more you know, the more you can save (in taxes)!

3. Land Tax

Finally, don’t forget about Land Tax! Land Tax is also an expense, not capital, so feel free to claim it on your return. Land tax for property investors is calculated on the total value of all your taxable land above the land tax threshold. And as Land Tax rates and thresholds vary from state to state, it pays to know what your Land Tax obligations are in your state. Land Tax has been levied on property owners since the early days of settlement in Australia, so it’s nothing new, just something else to think about.. So, we are here to remind you that it’s time you got a little bit of that money back!

Final thoughts

Property investment is a great way to grow your wealth and save for retirement. However, as the old saying goes ‘you don’t get rich by throwing away money’. So, make sure you are getting the most out of your investment by taking advantage of all the deductions available to you. Borrowing expenses, Lenders Mortgage Insurance, and land tax are just a few of the many deductions available to property investors. So don’t miss out – claim them all on your return!

TaxTank is a property investor’s best friend when it comes to tax. We can help you maximise your deductions and get the most out of your investment. With dedicated tax help tools for property investors, TaxTank delivers powerful software that allows you to take care of your property tax from start to finish. With their intelligent tools, built-in live bank feeds, and permanent document storage, you can ensure your property investment deductions are not missed, misinterpreted, or disallowed by the ATO.

Register for your free trial at TaxTank today and start getting the most out of your property investment!

Happy investing!


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Important Tax Deadlines

For all incomes earned between 01 July 2023 – 30 June 2024.  

Tax returns can be lodged from 01 July 2024. You can prepare early with TaxTank so you know exactly what’s going on ahead of time.

For all incomes earned between 01 July 2022 – 30 June 2023.  

Tax returns are now OVERDUE.  

You can use TaxTank to get up to date and lodge with our partner accountants.

Tax returns are OVERDUE.  

You can use TaxTank to get up to date and lodge with our partner accountants.

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