Own a Rental Property: Here is how you reduce your Taxes.
Its common knowledge that all the assets we own, whether immovable or movable is subject to deterioration and depreciation. Every single property in your portfolio will have costs associated with it, this will diminish its market value. As a landlord, you can deduct expenses associated with the property, it does not matter if the structure of the building that needs repair or the furniture inside the house of which forms apart of the rental unit as a whole. This means the tenant pays for the accommodation and the use of the movable goods inside the property.
Since depreciation and deterioration happens gradually, the type of repairs and improvements that a landlord will do to a property will include fixture repairs, as mentioned above, let us not forget the cost of the manual labor, rented tools and equipment, plumbing repairs, painting, repairing of wall cracks, leaky pipes and replacement of geezers. Other costs include utilities such as gas, electricity, water and sewerage.
Your Business Vehicle is a Tax Deductible.
As a rental property owner, you will most likely have a business vehicle that you use to travel to the property, vehicles also depreciate, you deduct the maintenance of the vehicle.
Travel expenses associated with commuting from your home to the rental property is also a tax-deductible expense. If you live far from the rental property and have to fly to that city, you can deduct the airfare and costs of hotel and food.
If you are smart and want to deduct more money, then you can operate the management of your property portfolio from your home, you must have a dedicated office space that is exclusively for the management of your business. This can take up to ten percent of your home, with that said, you can deduct expenses such as phone bills, stationery, laptops/computers and printing paper. If you have a second landlines associated with that business, it is also tax deductible.
Keep receipts in a tax folder so that you can substantiate your claim with proof.