11 must-know tax deductions for renters

Home | 25 April 2018

We’ve all heard about the tax benefits of owning property, but what about the massive population of renters?

A lot of our MATE’s are renting, which is why they love our no-contract internet plans! To help you out, here are 11 tax deductions that renters can take advantage of.

Disclaimer: We are not tax experts and this is not intended to be tax advice. We recommend speaking to a specialist before making any of these claims!

1. Home office expenses
While any rent paid on the physical space where a home office is located cannot be deducted, many of the items that you use can be. This includes things like printers, printer ink, other office supplies and laptops required for work.

If you work from home, these are all items that you need to purchase in order to do your job properly. Be careful and have a chat with your accountant before making the most of this tip because there are certain guidelines you need to follow.

2. Voluntary super contributions
Making contributions to your superannuation fund is one of the easiest and most common tax deductions. All individuals are able to make this deduction regardless of home ownership status. Not only are you lowering your tax liability but you are also setting yourself up for a comfortable retirement.

3. Additional work travel
While employees can’t deduct everyday commuting expenses, if any additional travel is required for work and you are not reimbursed by your employer, you are allowed to deduct these expenses. Make sure to track your mileage and keep hold of petrol receipts to make these deductions.

4. Investment expenses
You can’t claim your investments as tax deductions, but you can deduct expenses related to these investments. This includes the costs of paying someone to manage your investment portfolio. These fees are readily available and could be used to reduce your overall tax liability.

5. Caring for a relative
Family members that require your services and are unable to afford at home care can also trigger a tax deduction. Expenses related to the care of relatives in need should be tracked and filed accordingly. This can reduce your amount of income tax and result in a higher return at the end of the year.

6. Military service
Because military families are often on the move, it’s common for them to rent. If you have served overseas for more than half of a tax year it’s possible to receive a tax offset. This means that the amount of tax paid on your income will be greatly reduced.

7. Telco expenses
If you are required to pay for a phone or internet access for your work, it is more than acceptable to deduct these expenses from your taxes. In fact, it is estimated that one in three Australians now regularly work from home, which requires a device and internet connection to keep in contact with the office.

8. Low-income tax offset
If you make less than $66,667 per year you are eligible for special tax breaks. The program is designed to keep money in the hands of those who really need it and receive a far greater benefit from keeping it. Known as LITO (low-income-tax-offset), this is one of the most common tax breaks that all individuals can make whether they own a home or rent. You can calculate your LITO here.

9. Private health insurance
Tax rebates are available to those who opt to take up private health insurance. Although it is not a requirement, private healthcare offers peace of mind that if something goes wrong you’ll be covered. Plus you can offset tax!

10. Giving to charity
All charitable donations are tax deductible as long as the charity is a registered deductible gift recipient. It is well worth your time to verify this information before making any kind of donation that you intend to use for tax write off purposes.

11. You’re at least 65 years old
Many retirees utilise low-cost renting to get the most out of their retirement savings and benefits. They can also get tax deductions. Those 65 and over are eligible to receive seniors and pensioners tax offset. This is especially useful for retirees who are self-funded but still meet these age requirements.

Wrap up
Understanding which tax deductions you are eligible for is the first step to maximizing your return. By being an informed taxpayer and talking to your accountant about these deductions, you’ll be in a stronger position when tax time comes around again.

Disclaimer: We are not tax experts and this is not intended to be tax advice. We recommend speaking to a specialist before making any of these claims!