Holiday Home Tax

Many Australians own a holiday home, but according to the Australian Taxation Office, there are a small number of holiday home owners who, on average claim deductions that are six times higher than income earned from the property.


You can only claim deductions to the extent their holiday home expenses are incurred for the purpose of producing rental income.
Is there a commercial-like purpose to the availability for rental? An apportionment of expenses may be appropriate.
Some questions to answer can help ensure the claims are a valid rental deduction:-
  • How many days was it rented out and was the rent in line with market values?
  • Where do you advertise for rent and were any restrictions placed on tenants?
  • Have you, your family or friends used the property?
A reasonable level of experience and judgement (from your tax professional) can assist
satisfying these subjective issues.

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