Tax Deductions for Investors Checklist
To be tax deductible, expenses must be actually incurred and must be directly connected with your investment income earning activity. If an expense has joint investment and personal purposes, only the investment-related portion may be claimed as a tax deduction. Receipts are essential to prove an expense was incurred.
An investor is one who acquires an asset and holds it for the purpose of receiving the income it generates, not to be confused with a trader, who buys with the intention of reselling at a profit.
Intending investors, those yet to make an investment, are not entitled to these tax deductions, as they are not yet investors:
- Recurrent management fees
- Accountant and tax agent fees
- Interest and fees on money borrowed for investment if the purpose is to produce income. NOT Interest and fees on money borrowed for investment if the purpose is to produce capital profits – that interest would be capitalised as part of the cost base of the asset.
- Bank account costs and fees on investment accounts
- Computer usage and software directly related to producing investment income and managing investments
- Subscriptions to investment information services
- Attendance at investment seminars, including travel and parking
- Home office expenses
- Travel to and from meetings with advisors and attendance at seminars