claiming travelling allowance & cost of meals when inspecting IP

N

Nic0

I do a lot of traveling with work and when i am away from home i get payed a traveling allowance, meal allowance, incidentals and refunded the cost of the accommodation.

Obviously you can claim the cost of the accommodation when inspecting an IP.

The ATO website isn't very helpful when it comes to "other costs"

claiming travel expenses deductions http://www.ato.gov.au/individuals/c...02/002/013/003&mnu=43443&mfp=001/002&st=&cy=1

Is it acceptable to claim the cost of meals, whilst traveling to and from the property and while you are inspecting the property and to don't think i could get away with trying to claim TA and Incidentals but if someone knows the link to the relevant publication could they please post it.

PS: If your only response is ask your account then don't bother replying.
 
The links posted in the previous reply are helpful & essentially the simple rule is that you can’t claim any expenses for anything unless it’s for income production.

As obvious as that may sound, this simple test leads to the correct answer to this and other similar questions.

As an investor that has an IP for rent, you can claim expenses related to the management and maintenance of that income producing property like travel to and from to inspect, meet advisors or facilitate repairs etc. However, you can’t claim the cost to fly or drive to Surfers Paradise to check out a prospective investment unit off the plan because it’s not generating income and you don’t even own it yet. Equally, the investment block of land that you bought to build on one day to create a rental opportunity doesn’t generate income yet (D’oh!) so therefore does not constitute a valid income vehicle from which to claim expenses (until you start building potentially – see below).

So in simple terms,. The ATO is OK for you to claim expenses related to income producing activities but not prospective ones or just ideas you might have about “one day...”

So what about farms and built developments that take time to produce income? As long as there is a clear plan to produce income in a reasonable time (as defined or OK’d by your advisor) you can claim the cost or expense inputs on the way. However, if you don’t make it you’ll need to potentially explain why and deal with it as well.

Hope that helps

Cheers, Mark
 
I think you will find that if you are in the business of property investing then it may be possible to claim deductions for trips against income.

If you are just a passive property investor then a trip to inspect a property may be able to be claimed against capital gains (if you end up buying that property).
 
Ok to claim certain expenses if the primary purpose for your trip is to inspect/maintain a property you currently own. If it's a prospective buy, then as Terry suggested it becomes part of the cost base of the property, only if you purchase it.
 
Last edited:
Nic0 bit unclear when you say "are inspecting the property" do you mean doing a 6 monthly/yearly inspection of an existing IP or inspecting a property to buy.

If it is inspecting an existing IP then most things like travel/meals/accommodation are claimable, although would need to be proportioned if the purpose of the trip was not 100% to inspect/maintain/repair property.

http://www.ato.gov.au/print.asp?doc=/content/00205421.htm
http://www.apimagazine.com.au/api-o...les/what-fees-can-you-claim-as-tax-deductions

If it was to inspect to buy others have pretty much covered that
 
You must log in or register to reply here.

Similar threads

Terryw
Free SMSF and Tax Seminars by ATO
Replies
2
Views
1K
BV
B
K
How much can you claim when you no longer rent the property after the tenants leave?
Replies
10
Views
5K
kathryn d
kathryn d
Z
Cgt Pro - 6 Years Rule Question
Replies
3
Views
2K
DaveM
DaveM
F
Question relating to Allowances and Travel when searching for investment properties
Replies
11
Views
1K
Sunfish
S
M
Fuel Tax Credits
Replies
0
Views
507
MattR
M
Back
Top