Rental Interest

Claim rental property interest correctly

Rental interest deductions are one of the most common things not claimed correctly.

If you bundle rental property loan and include personal items, such as a car or holiday:

  • the interest must be apportioned for the cost of those items over the life of the loan, even if those items don’t last the length of the loan
  • you can’t just repay the part of the loan relating to the private purchase, even when they refinance.

You also need to apportion claims for interest expenses:

  • according to your ownership
  • if the property was rented out for part of the year
  • when only part of the property was rented out
  • if you use the property or kept it vacant for yourself
  • if it’s rented at below market rates.