Tax season has a habit of sneaking up on us, especially for those breaking a sweat in the real estate game. Many real estate professionals often find themselves blind-sided by tax season and end up getting a much smaller return than they are entitled to.

It’s far too common for real estate professionals to be unaware of the widespread deductions they are entitled to and end up missing out on many key ways they can maximize their return.

Our tax professionals at Immunity Accounting have stepped in to create an easy-to-follow guide for Real Estate professionals to get a larger return and make tax season a breeze.

Am I eligible for any deductions?

As a Real Estate professional, you are eligible to claim a range of deductions for any money you’ve spent for the purpose of your employment during the financial year. This can include products and services, as well as many at-home costs you may be unaware, are claimable.

This only includes money that hasn’t been reimbursed to you through your employer directly.

Let’s break it down further below:

What deductions am I eligible to claim?

There is a wide selection of deductions you are eligible for, these include:

• Any costs you personally incur for advertising. This can include newspapers, letterbox drops, signage, bunting, just to name a few. This deduction doesn’t apply to Real Estate professionals that earn a fixed salary and are not entitled to earn a commission.
• Any car expenses you undertake as a result of your job can be deducted. This does not include commute costs, but it does include travel to open houses, inspections, or travelling to other office locations for your job.
• The cost of repairing, cleaning, or buying company-specific clothing items can be claimed. These items must be specific to your job, such as having the company logo on them.
• You can claim the cost of gifts that you provide for clients, as long as it’s for work purposes. You cannot claim this deduction if the company has reimbursed you for the cost of these gifts. This can only be claimed if you’re receiving a commission.
• The cost of marketing equipment, such as digital cameras, can be claimed as long as they are used for your work. You cannot claim the cost of a mobile phone if used to take pictures of a property.
• Any self-education costs can be claimed, as long as they relate directly to your current position. This includes the cost of agent licences, certificate, seminars, or required training courses.

What deductions can’t I claim? 

There are many deductions that you are not entitled to, these include:

• You cannot claim entertainment costs incurred for prospective clients, such as dinner, sporting events, or concerts. Even if you discuss business at these events.
• Any equipment that is provided by your employer, that you may take home with you. Such as laptops or cameras.
• You cannot claim self-education costs if they do not directly relate to your current position. For example Training courses to help you transition out of Real Estate work.
• The cost of generic office clothing, such as suits, dresses, pants, or shirts, even if you only wear these clothing items for work.

Records – The Most Important Step 

Good record keeping is the backbone of any successful tax return, and keeping good records can often net you a higher return in the end. It provides our tax professionals with more ways to maximize your return.

It’s a good idea to always keep receipts, bank statements, credit card statements, invoices, or even a logbook if you plan to claim travel costs.

Remember: You don’t always need physical records. It is perfectly acceptable to keep a digital copy instead. As long as the following information is present:

• The name of the supplier
• Amount of the expense
• Nature of the goods or services
• Date the expense was paid
• Date of the document

Important: You don’t need to keep receipts for expenses under $10. However, if these expenses add up to more than $200 on your return, records will be required to back your claim.

I’ve made a mistake on my return – What do I do?

It’s important not to panic. We all make mistakes, and the ATO understands this. They won’t suddenly break down your door for a minor mistake on your tax return.

If you think you’ve made a mistake on your return, it’s vital you attempt to amend it as soon as possible. This will help you to avoid any penalties incurred from prolonged mistakes on your tax return.

In the event you’ve made a mistake, you can reach out to the ATO directly, or contact our taxation professionals over at Immunity Accounting. We’ll be happy to help fix up your return and get you the biggest value from those deductions possible.