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Rental Guide
Fully deductible expenses :-
- Legal fees incurred during the process of purchasing the property.
- Accounting fees for the ongoing costs of managing your rental accounts, preparing its tax returns and obtaining advice.
- The cost of advertising for tenants and agent letting fees.
- A valuation of the property for the purpose of getting finance, or a valuation of chattels for depreciation.
- Bank fees associated with applying for finance.
- Commercial cleaning of the dwelling and rubbish removal.
- Repairs and maintenance costs, i.e. the costs incurred in maintaining the condition of the property once it is tenanted or while it is available for rent.
- Lawn mowing and other gardening.
- Insurance on the rental property, and mortgage repayment insurance on the rental’s mortgage.
- Interest on money borrowed to purchase the rental property or renovate it. refer to https://www.ird.govt.nz/property/renting-out-residential-property/residential-rental-income-and-paying-tax-on-it/property-interest-rules
- Vehicle costs incurred in travel associated with the rental property, such as conducting property inspections while tenanted (a mileage logbook should be kept for this).
- Rent collection fees.
- Rates on the property.
- Home office expenses may also be claimed if you can sufficiently prove to IRD that you manage your rental property affairs from home. In this case you can claim a partial deduction of your private home expenses such as electricity, rates, insurance, mortgage interest, phone, internet and so on.
Non Deductable RENTAL expenses
- A valuation of the property for the purpose of buying it.
- The cost of making improvements to the property, including any renovations and repairs made prior to the first tenant moving in.
- The cost of bringing a dilapidated property back up to a rentable standard after acquisition.
- The principal portion of your mortgage repayments.
- Any costs associated with finding a property to purchase.
