The Australian Taxation Office (ATO) are encouraging all taxpayers with a rental property to ensure they understand their obligations and get their claims right.

Due to enhancements in technology, the ATO have increased their ability to identify incorrect claims, and they want to ensure you don’t get caught!

They’ve provided a number of case studies and I’ll be sharing them with you over the course of five weeks, here’s case study 3*:

Incorrect claims for a newly purchased rental property and false claims:

Nancy recently purchased a rental property and had her tax return amended by the ATO to remove deductions for repairs, capital works and incorrectly apportioned borrowing expenses.

Nancy had inappropriately claimed a deduction for repairs to defects present in the newly purchased property and the capital works and borrowing expenses should have been spread over several years.

Nancy also provided false receipts for property management fees undertaken by a family member.

Nancy was required to pay more than $57,000 back to the ATO as well as over $10,000 in penalties for making a false statement in her tax return.

Don’t be like Nancy.

Regards

*reproduced from NTAA