The end of each financial year serves as a good reminder for ensuring an investment property portfolio and strategy is performing to full potential.
BMT Tax Depreciation is Australia’s leading supplier of tax depreciation schedules and has a team of experienced property investors on board. Here are their four key investment tips to starting fresh in the new financial year.
- Set goals for the coming year
Without sounding like a cliché, evaluating your goals and where you want to be this time next year is an imperative step to setting yourself up for success.
Evaluate what went well, and not so well, in your investment property portfolio this year. Recognise the positives and identify areas for improvement. Set time up with your accountant to discuss your financial position and what can be done to improve your investments’ cash flows this year.
Completing these simple steps early will provide a solid foundation for the year ahead.
- Make filing easier from the start
Having a simple way to keep records now will save you stress down the track.
MyBMT is a free portal that helps property investors manage their depreciation and investment needs with ease. It has many features, two of which are its ‘income and expenses’ and ‘files’ sections.
The income and expenses feature allows you to store all income and expense-related documentation related to your property, such as receipts and trade invoices. The file feature lets you store documents like condition reports, legal documents, tenant correspondence and images.
But how is this different to simply having a folder on your computer’s desktop? Well, storing these in MyBMT means your accountant can have direct access to all documents at all times if they also have a MyBMT account. This ease of information-sharing significantly reduces the number of emails back and forth, and hence the room for error.
- Establish a cash flow forecast
Some property expenses come as a surprise, while others can be accounted for months in advance.
Forecasting your yearly cash flow’s peaks and troughs will help you be prepared throughout the financial year
For instance, you can strategically set the property’s lease to cover times when hefty expenses will fall due, thus mitigating the risk of having an empty property during an expensive ownership period.
Having a buffer account to cover unexpected expenses is also a must.
- Obtain a depreciation estimate
If you own an investment property and don’t claim depreciation, then it’s time to start.
Depreciation is the natural wear and tear of property and assets over time. Everything depreciates, but only owners of income-producing property can claim it as a tax deduction each financial year. A tax depreciation schedule is essential to claiming depreciation to its ultimate potential.
Many investors fail to take full advantage of depreciation. This avoidable mistake could cost them thousands, even tens of thousands, of dollars in the long run.
Avoid being part of this group and start the new financial year right by obtaining an obligation-free depreciation estimate.
BMT Tax Depreciation prepares specialised tax depreciation schedules for all types of properties. Get your depreciation estimate today and Request a Quote or contact the BMT Team on 1300 728 726.