Review your property portfolio

Major changes were introduced in 2021 limiting property investors’ ability to deduct interest payments on loans for residential homes from their tax bills.  Interest on loans for residential properties purchased after March 2021 is no longer deductible.

For residential investment properties bought before March 2021, there’s a phase-out of the old interest deductibility rules that will run until March 2025:

  • Property owners can deduct 75% of interest costs until 31 March 2023
  • After that date and until 31 March 2024, property owners can deduct 50%
  • Between 1 April 2024 and 31 March 2025, investors can deduct 25%
  • After 1 April 2025, investors can no longer deduct any interest.

Property investors need to calculate their interest phase-out for the coming tax year and talk to us about the potential impact in the years ahead.  There are exemptions for ‘new builds’ and certain types of property.  Please talk to us to see if these apply.

Do you have commercial buildings?

Remember that depreciation deductions for non-residential buildings were reintroduced for the 2021 and subsequent income years.

Have you bought or sold properties in the past year?

Tell us about the split between residential vs commercial, and the full details on new loans and credit lines so we can work out your obligations, including any possible impact of the brightline rules.