Five tax-deductible home improvements you can make today

Tax time is around the corner, and we all know what that means. It’s time to lodge your tax return, and more importantly, claim your investment property tax deductions. So what are you entitled to claim? Whilst we recommend working with a registered tax agent to get professional advice for your tax return, we have collated a list of 5 home improvements you can make today to your investment property that also qualify as deductions you can claim. 

Now is the time to think about how you can maximise your return, but also how to keep your tenants happy, so why not do both? As more tenants are working from home right now, these minor improvements could have a significant impact. Read on to see if any inspiration strikes. 

1. Boost your green energy with solar power

Solar power is an excellent form of investment that benefits both the environment and the electricity bill. Every tenant will appreciate a lower energy bill, and in the long run, this investment can also enable you to charge a little bit extra for rent. Solar systems are tax-deductible; however, they are offset against their depreciation rate, which means you’ll be able to claim a portion of the expenses over several years rather than an immediate deduction.

2. Get ahead of summer with ceiling fans

Ceiling fans can make a massive difference during the hot Aussie summer by increasing ventilation and airflow around the home. It’s also a more cost-efficient form of cooling compared to air conditioning and very budget-friendly home addition. With rising power costs, your tenants will significantly appreciate this energy-efficient addition, and you’ll also be able to obtain tax advantages. Capital item purchases below $300 in price can be claimed in full within the same tax year.

3. Refresh with a paint job

A fresh lick of paint can do wonders to any living space and instantly bring the wow factor up; plus, it’s one of the most budget-friendly improvements you can make to a property. Not only can paint revamp the property’s interior but also protect it from the external elements when painted on exterior surfaces. A new look for your tenants and tax deductions for you? Win-win! 

4. Upgrade window coverings

With Australia’s temperamental weather and the harsh natural elements, windows and coverings are often one of the first damaged features. To upgrade windows to be more durable under rain, hail or shine, you can opt to invest in double glazed windows, which can keep your tenants warm in winter and cool in summer. Who doesn’t like being toasty in winter without having the heater on blast?

Flyscreens and window locks can also add to your tenants’ security factor and keep out pesky flying creatures. These additions can also be claimed immediately if each item is below the cost of $300, making them a perfect investment right before the end of the financial year. 

5. Invest in new fencing

If your fencing is looking a little tattered and worn out, then it’s time to install a new fence. Not only will this increase the sense of security for your tenants living in the property, but it’s also an immediate tax deduction. As you’ll be restoring the fence to active status, this would be classified as a repair and an expense necessary for your investment property. 

As a rule of thumb, any costs incurred from repairing or maintaining your investment property can be claimed within the same financial year. However, capital improvements that involve the enhancing of pre-existing features are depreciated against the asset life. Be sure to keep a record of all the additions you make to the investment property and hire an accountant if things get too complicated or you’re unsure.

Pet-proofing your investment property

While it would be amazing to have a whole post with only pictures of cute puppies and kittens, we can’t justify that. So, we compromised and in between cute pictures, here are some suggestions on how to pet-proof your rental property. 

The rental laws in Victoria are changing, and one of those changes is that rental properties are now much more ‘pet-friendly. A Victorian tenant now only needs to gain written consent from the landlord to have a pet. The only way that the landlord can refuse is by getting approval from VCAT.

With Victoria implementing changes like this, the other states and territories won’t be too far behind. So, why not start thinking about what minor changes can be made to ensure your tenants and their pets are comfortable in their home. 

Speak with your tenants

Chatting with your tenants (or prompting your property manager to have a chat) about having an animal in your rental property management is a significant first step. Tenants are usually more than happy to be flexible, and at the end of the day, any property damage is on them to repair. A few points to discuss:

  • If you have air conditioning or ducted heating, consider letting the tenant know that animal hair can clog the vents and suggest regular grooming for long-haired animals. Agree upon a recommended frequent filter change, and anything additional is to be at the cost of the tenant.
  • If there is an expensive carpet in certain rooms, perhaps just informing the tenants will be enough. Recommending or even purchasing and installing safety gates is a cost-effective way to keep some pets out of these areas. 
  • Ensure that any damaged fencing is repaired and that animals have an undercover area outside to encourage tenants to leave their pets outdoors during the day.

Make your garden hardy and safe.

Many plants are poisonous for cats and dogs. If these plants are in the garden, make sure the tenant is informed. If they have pets, consider removing the plants altogether. 

If you happen to be looking at renovating your garden or courtyard, consider making it easy to maintain for the tenant.

Use the tough paint

If you’re thinking of giving the place a lick of paint, go with the wipe friendly, more challenging colours. These fare much better than the satin finish when it comes to happy puppies or messy kittens. Sometimes all it takes is a happy wagging tail after a roll in the mud, and the walls are a disgrace!

Invest in landlord insurance

This should be a given. Not just to cover potential pet damage but to cover anything that goes wrong. You insurance your residence; why not your investment property? 

Landlords want their tenants to be happy, pay rent, and take care of the property they inhabit as if they owned it themselves. By making the tenant as comfortable as possible and showing that the landlord cares, tenants are sure to go the extra mile and stay in a property longer, truly making it their home. 

Should you accept pets in your rental properties?

Accepting pets in your rental properties can be a bit risky, but that doesn’t mean you should make it in-paws-ible for renters to bring their pets along. Here are some tips for avoiding catastrophe when it comes to renters and pets:

1. Accept pets out of hand

There’s a big difference between a pit bull and a goldfish. Ask your renters precisely what types of pets they have and how well trained they are. For example, you could allow small pets such as hamsters, even if you’re not comfortable with dogs and cats. Or, you could require that dog owners supply proof of their pet’s graduation from obedience school before you can consider them. Ask for a picture of the pet to get a good idea of whether you’re comfortable having it on your rental property.

2. Certain situations might turn out to be in-paw-sible, so treat everything case-by-case

A large dog in an apartment with no garden may get frisky. For that reason, you may need to set restrictions on the size of pets allowed if your rental property is small. Another thing to consider here is how often the renter will be home. Will they leave their dog alone all day while they work long hours? If so, this increases the risk of damage.

3. It’s purr-perfectly fine to require that your tenants get a professional cleaning done

With furry pets, hair will probably end up on everything but the kitten sink. Don’t worry, though—most of the time, it’s possible to clean up after messy pets. If you decide to allow pets, you can charge a small fee to cover extra cleaning, such as professional steam clean, regularly or just when the tenants move out.

4. Consider whether the interior is suited to pets

Dogs and cats can scratch up carpeted or hardwood floors. Koalas might climb on the windowsills and rip the fly screens to shreds. An angry kangaroo may box holes in the walls. Think about the durability of the house and whether it can handle potential damage. And, of course, make sure it’s the tenant’s responsibility to pay for repairs for specific types of damage do occur.

5. Catch pet damage early

When pets are involved, a property could paw-potentially end up in ruff shape! We take detailed video entry condition reports and compare them to the current condition with every routine inspection. This helps make sure that we catch pet damage early and can call the tenant to account.

Cost-effective renovations for your investment property

Updating your investment property doesn’t have to break the bank and has a myriad of benefits. You’ll increase the value of your property, so come time to sell it down the road, you’ll be looking at a higher sale price. The increase in rental return is the most obvious, but you’ll also attract different tenants with a higher rent. 

By exploring which improvements to make to your investment property now, you may find minor issues that can save you from having to spend the big bucks down the road with a bit of work.

Many renovations and updates to your property maintenance can be claimed as investment property tax deductions, meaning that you will see up to 90 per cent of costs reimbursed. 

We’ve pulled together some tips to guide you on makings some cost-effective renovations to your investment property:

peak with your property manager:

A great place to start is by talking to your property manager. An experienced property manager speaks with potential tenants day in and day out. They understand what the market is looking for in your area and can help you tailor your renovations to these market demands.

A good property manager will also have excellent connections when it comes to tradespeople. Using a recommended tradesperson can be the difference between quality work at a reasonable price and being ripped off for sub-par work. Take recommendations seriously. 

Focus on the bathroom and kitchen

Often the things that tenants look at first in a potential rental are the kitchen and bathroom. Simple things such as old tiles and cupboards can age these spaces a lot. 

There is a common misconception that updating a tired wetroom is extremely expensive. Often a lick of paint or updating things like towel rails, showerheads and shower curtains can give a dated bathroom a new lease on life. Special tile paint is a perfect way of editing if you don’t have the dollars to spend on re-tiling. 

Kitchens can be updated on the cheap by replacing cupboard doors and handles, new paint for walls and tiles, new shelving and hardware such as taps. If there’s room, include extra bench space with an island bench. Popping in additional storage space is another excellent way to add value to a kitchen space; adding a built-in or freestanding pantry gives tenants extra space for their gizmos and gadgets.

Neutral colours

Using a neutral colour palette gives tenants a blank canvas to make their own home by including their colours, artwork and furniture. Your investment property is not the right place to practice your creative freedom: the colour and patterns you find attractive may be a turnoff for prospective tenants.

If repainting is a part of your renovation plan, choose neutral colours and install door stoppers to protect your fresh paintwork.

Outdoor space

Updating the outdoor space is a great way to add value to an investment property. Having a beautiful courtyard, front or backyard is like having an extra room. The gorgeous Australian weather means that we take full advantage of the outdoors, and renovations to these spaces don’t have to break the bank.


With recent changes to rental laws in Victoria to tenants rights with pets, renovating with our four-legged friends in mind isn’t a bad idea. Some easy and inexpensive ideas were covered in a recent post on this very topic, and they include painting with hardy paint, including a doggy door and more.

The number one thing to remember is, pet-proofing can easily be personalised to your tenant for minimal cost. Not only will you build trust and a relationship with your tenants, but you’ll have the opportunity to protect your investment your way. 

Taking a tired investment property to the next level doesn’t need to break the bank. By incorporating a few of these ideas, you can see a real return on your investment.

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