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Travel claims and recording

Discussion in 'Accounting & Tax' started by dabbler, 12th Jan, 2016.

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  1. dabbler

    dabbler Well-Known Member

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    Hi All,

    When travel will far exceed the cents per k method, when you use multiple vehicles, when those vehicles have low running costs and are owned, not leased etc, what would be best method ?

    I suppose before changing, is it 5000 per person/vehicle ?

    Also anyone know scenarios you should not claim, i.e it seems you should not claim when your just going to look at an area, or if it is travel before you have a tenant, but, seems if you travel so you can inspect and sign contract, or, sign contract then inspect, that should be ok ?

    Maybe it is worth starting a log book anyway as well as the way you have done in the past.
     
  2. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    You cannot claim expenses like travel for visiting / inspecting / etc on property you do not yet own.
     
  3. teetotal

    teetotal Well-Known Member

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    Not even for OTP purchase ??
     
  4. dabbler

    dabbler Well-Known Member

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    I understand that principle, however it is not clear when exactly ownership is, unless it is spelt out somewhere, such as after full and final settlement. I would think a contract implies a level of interest/ownership.

    Also capital gains are from contract date, that implies ownership I would think.
     
  5. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    What are you inspecting if it isn't even built yet?
     
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  6. dabbler

    dabbler Well-Known Member

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    This getting away from best methods and record keeping/collecting, but the below is straight from the ATO site.

    • You can claim travel expenses for:

      • preparing the property for new tenants (except for the first tenants)
      • inspecting the property during or at the end of tenancy
      • undertaking repairs, where those repairs are because of damage or wear and tear incurred while you rented out the property
      • maintaining the property, such as cleaning and gardening, while it is rented or available for rent
      • collecting the rent
      • visiting your agent to discuss your rental property
     
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  7. Paul@PFI

    Paul@PFI Tax Accounting + SMSF Business Member

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    Diary record is sufficient for cents per KM. Date, explanation of trip (Syd - Brisbane) and distances. Important to also retain other evidence of your actual trip (ie accom receipts etc). You cant claim a deduction just because you own it.

    Up to 5,000km per vehicle you own. If you borrow a car you cant claim using cents per KM.
    For the 2016 year the logbook method OR cents per KM are the only methods allowed. If you use a logbook method then substantiation of operating costs become more complex.

    No car expenses deductions for
    - Buying a IP
    - Initial repairs, initial tenancy or attending settlement (who does that ?)
    - Signing contract etc
    - Mixed purpose travel ie holiday on Gold Coast + IP inspection.
     
  8. dabbler

    dabbler Well-Known Member

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    Thanks @Paul@PFI ....... I may start a logbook anyway as well.

    re settlement, no to that, but inspecting before settlement - yes, however if from a distance, would be easier to get someone else to do it and send a few snaps (I suspect that is what they would expect too).