If you are an Australian property investor it is essential you remain compliant with your taxation obligations regardless of your residency status as a foreign investor, Aussie expat or an Aussie living locally.
So, lets break down some important considerations for landlords:
Annual Tax Return
Landlords must declare rental income and related payments in their tax return. The Australian Taxation Office (ATO) is strict about the timely lodgement of annual income tax returns and will impose hefty penalties that may attract interest for failing to lodge by the due date.
It is your responsibility to submit on time, pay any tax due promptly and ensure any PAYG instalments are paid by the due dates. The Australian financial year is from the 1st July to the 30th June with a lodgement due date usually being the 31st October 2025.
It’s advisable to speak to an accountant that specialises in property taxation so that you are educated on all your deductables and will benefit from the maximum return. The ATO is particularly strict on withholding tax miscalculations, errors on capital gains tax, claims on non-deductable items and false residency status.
Pay-As-You-Go (PAYG) Instalments
Landlords in Australia may be required to pay quarterly PAYG instalments quarterly, based on their prior year’s tax payable. Whilst some landlords may voluntarily enter the PAYG system to help manage their cashflow and avoid a large tax bill when they lodge their annual tax return.
Foreign Investor Portal (for Non-Australian Owners of Australian Property)
The ATO launched the Foreign Investor Portal, designed to help non-resident property owners manage their obligations when acquiring or selling Australian property.
To use the portal, you must first obtain a MyID. This must be completed personally by the property owner.
If you purchased property on or after 9 May 2017, you may also be required to lodge an annual vacancy fee return, which can also be submitted through the portal.
Land Tax
Land tax is a state based tax applied to investment properties including holiday homes, apartments and vacant land. It is separate from your annual tax return and is your responsibility to register with your State Revenue Department. Each state has its own system and penalties for non-compliance.