Not Knowing which expenses are deductible and how to maximise them
Disclaimer: Nothing is this article is meant to constitute financial advice of any kind, and is the opinion of the author only. Seek professional advice before making any financial decision.
The tax rules around deductibility of expenses for rental investments can be quite gnarly and you do need to have a good knowledge of the tax legislation to make accurate assessments on these.
Making a mistake in this area can be costly and may cause you to upset your long-term holding strategy. Some expenditure can become “black hole expenditure” where it is neither deductible nor depreciable, which is definitely not the outcome that you want.
When you are calculating your rental investment profit/loss and cashflow needs, there are normal rental expenses that can be claimed such as described by Phil in his chapter on positive cashflow. However, some items affect...