Rental Property Tax Accountant

As a general guide, expenses incurred in earning rental income are usually deductible in the year they are incurred — examples often include loan interest, council rates, water and land tax, body corporate or strata fees, landlord insurance, property management fees, advertising for tenants, and routine repairs and maintenance. Some costs are claimed over time rather than immediately, such as capital works and depreciating assets. What is deductible, and whether it is claimed in full, apportioned, or spread over several years, depends on your circumstances and the relevant rules, so we review each item rather than assuming it is automatically claimable.

In general terms, a repair restores something to its original condition — fixing a leaking tap, replacing a few broken roof tiles, repainting an existing wall — and is often deductible in the year incurred. An improvement makes something better than it was, or replaces an item in its entirety, and is generally treated as capital rather than an immediate deduction. There is also a distinction for initial repairs: work to fix defects that existed when you bought the property is generally capital, even if it looks like a repair. The line between the two depends on the specific facts and the relevant rules, so we classify each item carefully rather than applying a blanket label.

A depreciation schedule, usually prepared by a qualified quantity surveyor, sets out the depreciating assets (Division 40 plant and equipment) and capital works (Division 43) for your property and the deductions available each year. Whether it is worthwhile generally depends on the age of the building, the fit-out and whether you are entitled to claim plant and equipment, which is subject to the relevant rules for second-hand assets in some properties. Where a schedule exists, we bring it directly into the rental schedule; where one would add value, we can refer you to a quantity surveyor. The position depends on your circumstances.

Negative gearing generally describes the situation where the deductible costs of holding a rental property — interest and other expenses — exceed the rental income for the year, producing a net rental loss. For the income year now under way, that net loss can generally offset other assessable income, such as salary, in the same year. That is changing under enacted law: from the 2027–28 income year, the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (No. 49 of 2026) quarantines an excess of residential-property deductions over residential-property income — the excess is applied against certain residential capital gains or carried forward rather than deducted against other income that year, so it is deferred, not abolished. Amounts relating to an ownership interest last acquired before 7.30 pm (legal time in the ACT) on 12 May 2026 are disregarded. The mechanics, the grandfathering test and the carve-outs are set out in full in our technical resource on the negative gearing changes from 2027–28, linked below. General information only, current as at 13 July 2026.

For the eventual sale, the cost base generally matters as much as the income each year. As a general guide, it helps to keep records of the purchase price and acquisition costs (stamp duty, legal and conveyancing fees), capital improvements over the holding period, and certain holding costs, alongside the dates and amounts. Some amounts already claimed as deductions — such as capital works — can affect the cost base on sale under the relevant rules. Note also that an amount the new quarantining rule prevents you from deducting cannot instead be added to the cost base or the reduced cost base. We maintain a running cost-base record as part of the annual engagement so the numbers are in order well before you sell, rather than reconstructed years later.

Yes — it is enacted law rather than a proposal, though it does not touch gains realised before it applies. Schedule 1 of the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (No. 49 of 2026) restructures the discount for CGT events happening on or after 1 July 2027: the discount percentage becomes 0% for resident individuals and for trusts that are not complying superannuation entities on ordinary assets, with cost-base indexation applying instead, while complying superannuation entities keep the 33⅓% discount and concessional discounts are preserved for qualifying new residential dwellings and eligible affordable housing. CGT events happening before 1 July 2027 keep the existing 50% discount where the conditions are met. The provision-level detail sits in our technical resource on the CGT discount changes from 1 July 2027, linked below. This is general information only, current as at 13 July 2026; we confirm the position for the relevant income year inside an engagement.

Fees depend on the number of properties, the ownership structure, the condition of your records, whether a depreciation schedule already exists, and whether there are co-owners whose returns also need the schedule. We quote a fixed fee in writing, scoped to your situation, after a short scoping call. There is no standard dollar figure because every investor differs — a single first-time landlord and a multi-property portfolio are very different pieces of work.