Rental Properties

Rental income and expenses

Rental income generally needs to be included in your income tax return. This includes income from long-term rentals and short-stay accommodation, although special rules can apply to boarders, flatmates and mixed private use.

You can generally claim the income-earning portion of eligible costs when you have records to support them. Private costs are not deductible.

Interest deductions and ring-fencing

From 1 April 2025, residential property owners can generally claim 100% of eligible interest costs, provided the normal deduction rules are met and the borrowing relates to earning rental income.

Residential rental deductions are still ring-fenced. This means deductions are generally limited to residential rental income. Any excess deductions are usually carried forward to use against residential rental income in a later year.

Timing and records

Rent received in advance is generally income in the year you receive it. Keep tenancy records, bank statements, invoices and details of any private use so the return can be prepared correctly.