The ATOβs top 10 tips for investors this tax season
Property investors are being encouraged to check their records and understand what they can and canβt claim, with the Australian Taxation Office (ATO) releasing its 2026 Investors toolkit.
The toolkit highlights 10 key areas investors should keep front of mind at tax time, including repairs, loan interest, borrowing expenses, capital works, body corporate fees, private use, record keeping and selling a property.
While investors should always speak to their accountant or registered tax agent about their personal tax position, the ATO guidance is a timely reminder that good records matter throughout the year, not just when a tax return is being prepared.
1. Get initial repairs right
Initial repairs are works needed to fix damage that existed when the property was purchased, such as painting scuffed walls or repairing damaged floorboards.
The ATO says these are capital expenses and canβt be claimed straight away.
2. Donβt claim purchase costs straight away
Costs associated with buying a rental property, including conveyancing fees and stamp duty, are not immediately deductible.
Instead, these costs are added to the propertyβs cost base and may be relevant when calculating capital gains tax if the property is sold.
3. Check how loan interest is being claimed
Interest may be deductible where it relates to the rental property and earning rental income.
However, investors canβt claim interest on any part of a loan used for private expenses, such as school fees, a holiday or other personal costs.
4. Treat borrowing expenses correctly
Borrowing expenses can include loan establishment fees, title search fees, mortgage stamp duty and costs for filing mortgage documents.
If these expenses are more than $100, the deduction generally needs to be spread over five years, or the term of the loan, whichever is less.
5. Understand improvements and capital works
Extensions, alterations and structural improvements are generally treated as capital works.
The ATO says investors can generally claim these costs over time, rather than claiming the full amount straight away.
6. Check body corporate fees
Body corporate fees can be treated differently depending on what the payment relates to.
Administration fund payments may generally be claimed in the year they are incurred, while payments into a special purpose fund for major capital works may not be immediately deductible.
7. Apportion expenses where needed
Investors may need to reduce deductions if there is private use of the property.
This can include renting to family or friends below market rent, keeping the property vacant for private use, renting out part of a home, or renting the property for only part of the year.
8. Keep records for the full ownership period
The ATO says investors must have evidence of rental income and expenses to claim deductions.
Records should be kept for the entire period the property is owned, and for at least five years after it is sold.
9. Be prepared when selling
Selling a rental property may result in a capital gain or capital loss.
The ATO says capital gains or losses need to be included in the tax return for the year the sale contract is signed, not the year settlement occurs.
10. Check clearance certificate requirements
Foreign resident capital gains withholding applies to Australian property disposals unless the seller is an Australian resident for tax purposes with a clearance certificate, or a foreign resident with an approved variation notice.
The withholding rate is 15 per cent.
Good records can make tax time easier
Tax advice should always come from an accountant or registered tax agent, but good property management can make it easier for investors to keep the right information throughout the year.
A property manager can help investors maintain rental statements, maintenance records, invoices, inspection reports and communication records, giving them clearer information to provide to their accountant or tax agent.
For more information, view the ATOβs 2026 Investors toolkit.
