When you’re starting out as newer Landlord, the tax filing process may seem a bit murky at first. What must you claim? Income? Expenses? Well, in this short blog post, will help steer you in the right direction so that your tax filing goes as smooth as possible.
Income – This is simple. This includes all of the gross rents generated by your property. If you own a duplex or triplex, all units are considered in this total.
Expenses -
The most common expenses for landlords are:
Advertising- A sign in the window or the front porch? Did you pay for advertising on Kajiji? Facebook Marketplace? The Newspaper? That all applies here.
Insurance – How much was your “Landlord’s Insurance” Policy for your rental property?
Interest – Whatever interest was incurred throughout the year. Ie: Mortgage interest
Legal, Accounting, and Other Professional Fees – This can include any professional fees incurred for the operation of your rental property. If you used a realtor to fill a vacancy, then you can include the real estate commission.
Maintenance and Repairs – This includes any maintenance and Repairs or improvements undertaken on your rental property. A paint job, new vanity, some exterior landscaping? Yes they all apply under this category.
Please note: Appliances aren’t treated as Maintenance and Repairs. They are treated as a capital expenditure and are depreciated over time.
Maintenance Fees – This applies to condo-type investments.
Property Taxes – Self-explanatory.
Travel – Say if your rental property is 4 hours away and you have to incur regular travel expenses to manage your investment then you can claim certain expenses under this category.
Utilities – If you pay for the utilities in the rental property, then this is something that you can claim as well.
As a landlord, these are most of the expenses that you will have to track. If you have any questions don’t hesitate to reach out. And remember, everyone’s tax situation is different so please speak to your tax preparer before finalizing your returns.
Comments