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Claiming Mortgage Interest, Rent and Council Rates

March 10, 2019

Can and should you claim your Home Loan, Rent, Rates and Contents Insurance?


We have seen and heard many comments from educators about whether they are entitled to claim part of these types of expenses for tax purposes. While everyone’s circumstances are different in determining this, we have also seen some very broad and scary statements made from both Educators and Accountants on how the law applies to these expenses.


Most of the threads usually end up with everyone being more confused than when they started with no real resolution.


Rather than rely on our opinion, or upon the specific Accountant you may choose to listen to, we have prepared a brief summary of some private rulings issued by the tax office in relation to claiming part of your mortgage interest and rates. The results may come as a surprise to a number of Accountants and the advice they have given.


Importantly, these rulings relate to claiming Mortgage Interest, Rent, Rates and Contents Insurance and do NOT apply to claiming costs for electricity, telephone etc which are determined completely differently with not as strict a criteria

ATO Private Rulings


The following are some case decisions made by the Australian Taxation Office in relation to individual educators and accountants. While not binding on everyone, they give guidance as to the opinion and stance of the tax office in relation to claiming these types of expenses.


Private ATO Ruling 1


Relevant facts


  • You commenced a Family Day Care business.

  • A requirement of the Family Day Care was that you made your home safe.

  • You look after children in your home five days per week.

  • The child care children have access to the all areas of the house except for the main bedroom.

  • You are allowed to have up to four Day Care children.

  • The Day Care children sleep in the bedrooms during the day.

  • When other members of your family are present, including your own children, they use the same areas as the Day Care children.

  • Expenses you incur in respect of the home