Holiday home owners will lose lucrative tax deductions for expenses such as mortgage interest and council rates if they block out their properties for personal use during peak periods like Christmas, Easter and school holidays.
In a new ruling, the Australian Taxation Office says owners are restricted to minimal private use – such as a few off-season weekends – if they wish to prove the property’s “main use” is to generate income rather than personal leisure, and therefore retain access to tax deductions.
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