What is negative gearing and how does it reduce my tax?

Negative gearing occurs when the costs of owning an investment property (interest, rates, repairs, depreciation) exceed the rental income. The resulting loss can be offset against your other income — such as salary — reducing your overall taxable income and tax bill.

How does the 50% CGT discount work for investment properties?

If you hold an investment property for more than 12 months before selling, you are eligible for a 50% discount on the capital gain. This means only half the gain is included in your assessable income. For example, a $200,000 gain becomes a $100,000 taxable gain — potentially saving tens of thousands in tax.

Should I hold my investment property in my personal name or a trust?

This depends on your circumstances. Personal ownership is simplest and accesses the 50% CGT discount. A discretionary trust offers income splitting and asset protection but cannot distribute losses. An SMSF offers tax rates of 15% in accumulation and 0% in pension phase. We review your specific situation and advise on the most tax-effective structure.

Can my SMSF buy an investment property?

Yes. SMSFs can invest in both residential and commercial property. Commercial property can be leased to a related party at market rent. Residential property cannot be leased to related parties. If borrowing to purchase, a Limited Recourse Borrowing Arrangement (LRBA) is required. We advise on the structure and compliance requirements.

What depreciation deductions can I claim on a rental property?

You can claim depreciation on the building structure (Division 43 — 2.5% per year for residential properties built after 1987) and on plant and equipment items (Division 40 — appliances, carpets, blinds, etc.). A quantity surveyor's depreciation schedule is required to maximise these deductions.

Do I need to declare my Airbnb income on my tax return?

Yes — all income earned from Airbnb and other short-stay platforms must be declared in your Australian tax return. Airbnb is required to report host income directly to the ATO, so it will be matched against your return. You can claim deductions for the portion of expenses (interest, rates, insurance, depreciation) that relate to the rental period and the area rented out.

Does renting my home on Airbnb affect my main residence CGT exemption?

Yes, it can. If you rent out your home (or part of it) on Airbnb, you may partially lose your main residence CGT exemption when you sell. The ATO apportions the exemption based on the floor area used for income-producing purposes and the number of days it was rented. We strongly recommend getting advice before you start listing your home on Airbnb so you understand the long-term CGT implications.

Property Investment & Airbnb Accountant Melbourne | Rental Property Tax

Property investment is one of Australia's most popular wealth-building strategies — but it's also one of the most tax-complex. Whether you need a rental property tax accountant, expert negative gearing tax advice, or guidance on capital gains tax on property in Australia, our specialist team has you covered. From negative gearing and depreciation to capital gains tax, land tax, and property flipping, there are numerous rules that, if navigated correctly, can significantly improve your after-tax return.

At Elite Accounting Solutions, we have extensive experience advising property investors and house flippers at every stage — from first-time investors purchasing their first rental property, to seasoned investors managing portfolios of 10 or more properties, to developers and flippers undertaking renovations, subdivisions and construction projects.

Property Investment Tax Services

Negative gearing strategies and rental property tax returns
Capital Gains Tax (CGT) planning — timing, exemptions, and discounts
Depreciation schedules for residential and commercial properties
Property trust structures for asset protection and tax efficiency
Land tax advice and minimisation strategies
GST implications of property transactions and new residential premises
Stamp duty advice on property purchases and transfers
SMSF property investment — compliance, borrowing rules, and strategy
Property development — GST, margin scheme, and profit structuring
Joint venture and partnership arrangements for property projects
Airbnb & short-stay rental tax returns and GST compliance

Short-Stay Rentals

Airbnb Accountant Melbourne — Short-Term Rental Tax Specialists

Listing your property on Airbnb, Stayz, Booking.com, or another short-stay platform? You're not alone — thousands of Melbourne property owners are earning income from short-term rentals, and the ATO is paying close attention. As specialist Airbnb accountants in Melbourne, we help hosts navigate the unique tax rules that apply to short-stay rental income.

Unlike a standard long-term rental, short-term rental income through Airbnb is treated differently for tax purposes — particularly when it comes to the main residence CGT exemption, GST, and apportioning deductions between personal use and rental periods.

Key Airbnb Tax Issues We Handle

Declaring Airbnb income correctly in your tax return
Apportioning deductions between rental and personal use days
Impact on your main residence CGT exemption when you sell
GST registration — when Airbnb hosts must register (>$75k threshold)
Land tax implications for short-stay properties in Victoria
Depreciation claims on furnishings and fittings
Airbnb host tax returns — individual and trust structures

The Main Residence Trap

This is the big one most Airbnb hosts miss. If you rent out your home (or part of it) on Airbnb, you may partially lose your main residence CGT exemption when you eventually sell. The ATO apportions the exemption based on the floor area rented and the number of days it was used for income-producing purposes.

For example, if you rent out 30% of your home for 200 days per year over 5 years, a portion of your capital gain on sale will be taxable — even though it's your main home. We help you understand this exposure before it becomes a problem.

ATO focus area: The ATO has specifically flagged short-term rental income as a compliance priority. Airbnb and other platforms are required to report host income directly to the ATO — so all income must be declared. We ensure your Airbnb tax return is accurate, compliant, and maximises your legitimate deductions.

Book a Free Airbnb Tax Consultation Read the Full Airbnb Tax Guide

Structuring Your Property Investments

Should your investment properties be held in your personal name, a company, a family trust, or your SMSF? The answer depends on your specific circumstances, tax rate, asset protection requirements, and long-term goals. We take a holistic view of your financial position and advise on the most tax-effective and legally sound structure for your portfolio.

Property Flipping Guide

The Property Flipper's Complete Tax Guide — Melbourne

CGT vs ordinary income, GST traps, the margin scheme, and how to structure your flip to keep more profit. Avoid the ATO pitfalls most flippers don't see coming.

Read the Guide

Property & House Flipping

House flipping has become one of the most popular property strategies in Melbourne — buy a run-down property, renovate, and sell for profit. But the tax treatment of a flip is vastly different from a long-term investment property, and getting it wrong can cost you tens of thousands of dollars.

We work with a large number of property flippers across Melbourne and Victoria, and we understand exactly how the ATO classifies these transactions. Key issues we help you navigate include:

Is your flip a capital gain (CGT applies) or ordinary income (full income tax applies)? — this is the critical question the ATO asks, and the answer depends on your intent, frequency, and the nature of your activity
GST on new residential premises — if you renovate substantially or build from the ground up, GST may apply to your sale, adding 1/11th of the price to your tax bill
The margin scheme — reducing your GST liability on eligible property sales
Holding costs and deductibility during the renovation period
The 12-month CGT discount — how to qualify and plan your timing
Entity structuring for flippers — personal name vs trust vs company, and when each makes sense
Subdivisions and multi-dwelling developments — a whole different set of rules
Record keeping for renovations — what you must keep to maximise your cost base

⚠️ Important: Many property flippers are surprised to learn their profits are taxed as ordinary income — not capital gains — if the ATO determines the activity is a "profit-making scheme." This can result in a significantly higher tax bill than expected. We help you plan your flipping activity correctly from the start to avoid unwanted surprises.

Melbourne Case Study

The Ringwood Renovation: What a Real Melbourne Flip Looks Like

A client purchased a dated brick veneer home in Ringwood for $680,000, spent $110,000 on a full internal renovation (kitchen, bathrooms, flooring, landscaping) and sold 14 months later for $960,000.

Without proper planning

Purchase + Costs$680,000

Renovation$110,000

Sale Price$960,000

Gross Profit$170,000

ATO Tax (marginal rate ~47%)~$79,900

Net Profit~$90,100

With Elite Accounting structuring

Purchase + Costs$680,000

Renovation$110,000

Sale Price$960,000

Gross Profit$170,000

Company tax (25%) + distributions~$42,500

Net Profit~$127,500

Key takeaway: The right entity structure and timing can save $30,000–$40,000+ on a single Melbourne flip. This is money that stays in your pocket — not the ATO's. Talk to us before you sign a Contract of Sale.

Read the full Melbourne Property Flipper Tax Guide Book a Free Flip Strategy Session

Real Estate Professionals

We also work with real estate agents, buyer's agents, and property managers who require specialist accounting for their business income, GST obligations, trust account compliance, and business structuring.

Related Specialisations

Property investors often benefit from our expertise across these related areas:

House Flipping & Development

Property flippers and developers face different tax treatment to long-term investors — CGT vs ordinary income, GST, and the margin scheme.

SMSF

SMSFs can invest in direct property via Limited Recourse Borrowing Arrangements — a powerful strategy for building retirement wealth.

Deceased Estates

Inherited investment properties trigger complex CGT rules that require specialist advice for executors and beneficiaries.

Don't leave money on the table. Book a free consultation today and let our property tax specialists review your portfolio strategy.

Why Choose Elite Accounting Solutions

Industry Expertise

Over 40 years of niche industry experience means we understand the unique tax, compliance, and business pressures your industry faces.

Personalised Service

We get to know your business personally. No call centres, no juniors — you deal directly with experienced accountants who care about your outcomes.

Proactive Guidance

We don't just do compliance — we proactively identify tax-saving opportunities and strategies specific to your industry throughout the year.

Clear Communication

We explain everything in plain English. No jargon, no surprises — just clear advice so you can make confident, informed financial decisions.

Real Estate, Property Investment & House Flipping Accountant