Holiday rentals under the microscope: The ATO has advised that it is sending letters to taxpayers in approximately 500 postcodes across Australia, reminding them to only claim the deductions they are entitled to, for the periods a holiday home is rented out, or is genuinely available for rent.
They advise that, to avoid making mistakes on their tax return, property owners should: - keep accurate records to ensure they declare the right amount of rental income; - have evidence for claims made; and - only claim deductions for the periods the property is rented out, or is genuinely available for rent.
If a property is rented at below market rates, for example to family or friends, claims for deductions must be limited to the income earned while rented.
Please note: these comments are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information's applicability to their particular circumstances. AusBiz Solutions 6583 5327