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Can i get a tax refund ?

Discussion in 'Accounting & Tax' started by Darlinghurst Boy, 30th Dec, 2015.

  1. Darlinghurst Boy

    Darlinghurst Boy Well-Known Member

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    If I was to use a plane to go to a Country area eg ..Sydney to Dubbo...can i claim tax deduction?

    1/ if i go there to purchase an IP
    2/ if i already owned an IP and needed to do an inspection?
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    1. no
    2. maybe
     
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  3. Greyghost

    Greyghost Well-Known Member

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    Generally inspections before you buy does not have any nexus to deriving income - it is too early in the piece.

    Generally an inspection for an existing property will be tax deductible. As long as you are not taking the mick and going on a holiday too, then you will need to apportion the claim between private and tax related.
     
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  4. Darlinghurst Boy

    Darlinghurst Boy Well-Known Member

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    Yes, I wonder what the requirements are for the Tax Office to travel to see your Ip are?
    Car fuel, plane fare, motel accomodation etc.
     
  5. MikeLivingTheDream

    MikeLivingTheDream BCOM MCOM MTAX CPA CTA Registered Tax Agent

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    If you are travelling to provide general maintenance to your rental property (that is, repairing wear and tear caused by you renting out the property), or prepare for incoming tenants and conduct exit inspections or generally inspect the property the travel expenses will be incurred in gaining or producing your assessable income.

    Provided there is NO private component in the travel, the airfare, accommodation and car hire or petrol (cents per kilometre probably the easiest method) you will incur on these trips will be deductible.

    If you incur expenses in relation to your spouse and you own the property 100%, these are not deductible as they are not considered to have a sufficient connection to the earning of your assessable income. Therefore, you will need to apportion your accommodation expenses.

    For example, if you travelled from one city to another, to undertake deductible repairs on your rental property (owned by you alone), but also took your spouse with you (for the purpose of company and shared driving) then apportionment of any accommodation would be as follows:

    Cost of a single room = $55

    Cost of double room = $70

    Deduction = $55
     
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  6. The Y-man

    The Y-man Moderator Staff Member

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    @Darlinghurst Boy - more fun to buy shares which have AGM's in different cities :D

    The Y-man
     
  7. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Or make sure the accom invoice indicates a sole occupant. :)
    The substantiation rules fall back on the paperwork.
     
  8. Scott No Mates

    Scott No Mates Well-Known Member

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    Where do you find accommodation in major regionals for less than $150/night?
     
  9. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Hilton Gunnedah ?? I think Mike was illustrating a point using obviously unrealistic rates. However, caravan park cabin accommodation may sometimes hit that price point.
     
  10. MikeLivingTheDream

    MikeLivingTheDream BCOM MCOM MTAX CPA CTA Registered Tax Agent

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    yes was just an example. in South East Asia that would get you quite a decent room at a resort on the beach.

    Given I have been helping a heap of companies (small and medium sized businesses) setup backend operation in the Philippines (architectural drawings, graphic design, IT support, call centres, payroll processing, accounts payable processing, accounts receivable processing, XERO bookkeeping, Class Super, etc) I spend a lot of my time in those places so used to lower rates.