As the end of the Australian financial year (EOFY) approaches, smart property investors know this is the ideal time to take stock. A thorough review of your investment property portfolio before June 30 can offer significant tax advantages, along with greater clarity and control for the year ahead. Here's why it’s essential, and how you can benefit both now and in the future.
Unlock Immediate Tax Deductions
One of the most compelling reasons to review your property portfolio before EOFY is the opportunity to maximise your tax deductions. Many expenses associated with investment properties are tax-deductible, but the timing of these expenses matters.
1. Repairs, Maintenance, and Improvements
If you undertake repairs or maintenance work before June 30, you can claim those expenses in your current year’s tax return, instead of waiting until the following financial year. This offers a more immediate reduction in your taxable income.
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Examples of deductible repairs and maintenance include:
- Fixing leaking roofs or plumbing issues,
- Repainting interior or exterior walls,
- Servicing air conditioners, smoke alarms, or other safety systems.
- Fixing leaking roofs or plumbing issues,
Important Reminder: While repairs and maintenance are typically immediately deductible, improvements and renovations may be depreciated over several years. A professional assessment now ensures the work is properly documented and categorised for ATO compliance.
Gain Strategic Financial Clarity
An EOFY review is not just about tax benefits, it’s also about making better decisions with a clearer understanding of your portfolio’s performance and potential.
2. Identify Underperforming Assets
Are any of your properties consistently delivering low returns or generating more expenses than expected? A portfolio review can highlight issues such as low rental yields, high vacancy rates, or growing maintenance costs. This insight can help you decide whether to renovate, refinance, or consider divesting from a poor-performing asset.
3. Optimise Your Loan Structures
Interest on investment loans is often your largest tax-deductible expense. Reviewing your loan terms before EOFY can help you:
- Identify opportunities to refinance at better rates,
- Restructure your debt to match your investment strategy,
- Improve cash flow by switching from principal and interest to interest-only repayments where appropriate.
EOFY is also a perfect time to seek pre-approval for new purchases in the coming year.
Ensure Compliance and Organised Records
With tax time fast approaching, having your financial documentation in order is critical. An EOFY review allows you to:
- Ensure you have receipts and records for all deductible expenses,
- Update your depreciation schedule, especially if you've completed renovations,
- Reconcile rental income, bond interest, and any insurance payouts correctly.
Taking the time to organise your records now can avoid compliance headaches later and ensure your tax return is accurate and audit-ready.
Set Clear Goals for the New Financial Year
Reviewing your current position gives you the clarity to plan ahead with confidence.
4. Plan for Growth and Acquisition
EOFY is an ideal opportunity to revisit your property goals. Whether you're looking to grow your portfolio, develop existing properties, or tap into equity, understanding your current financial position is key to executing those plans.
5. Refine Your Investment Strategy
Market conditions change, and so do your personal circumstances. A strategic review allows you to adapt your approach, whether your focus is on cash flow, capital growth, diversification, or consolidation.
Final Thoughts
Reviewing your property portfolio before June 30 is more than a routine check-in. It’s an opportunity to reduce your tax liability, boost your returns, and prepare strategically for the future.
If you haven't already booked a review with your accountant or property advisor, now is the time. Acting before EOFY can make a real difference, not only in your next tax return, but in your long-term investment success.
Want help with your EOFY property review?
We can help assess your portfolio performance, identify tax-saving strategies, and provide expert guidance for your next moves. Reach out
today to schedule your EOFY strategy session.
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