How to Claim a Tax Deduction for Interest & Dividend Income

How to Claim a Tax Deduction for Interest & Dividend Income

Don’t forget to claim your interest, dividend and forestry managed investment scheme income expenses on your tax return!

Did you earn interest and dividend interest over the tax year? According to the ATO, If you earned interest, dividend or other investment income over the tax year, you might be able to claim a tax deduction for any expenses you incurred while earning that income.

When lodging your taxes, it’s important not to forget to include these tax deductions!

To get started, the ATO dividends income source expenses into three income categories;

1. Interest Income Expenses

2. Dividend and Share Income Expenses

3. Forestry Managed Investment Schemes

What Interest Income Expenses can I Deduct?

If you income from interest is from an account held for investment purposes, such as cash management accounts, you can claim account-keeping fees for your interest income expenses.

What Dividend and Share Income Expenses can I Deduct?

If you borrowed money to purchase shares or other related investments which you derived assessable interest or dividend income from, then you can deduct the interest charged on the borrowed money.

As long as they were costs incurred from managing investments, you can claim the following expenses;

  • Travel expenses

  • Specialist investment journals and subscriptions

  • Internet access costs

  • Borrowing costs

  • Decline in value of your computer

To learn more of what falls under the dividend and share income expense deductions, visit this section of the ATO’s website. 

Are Forestry Managed Investment Schemes Deductible?

If you have made payments to a forestry managed investment scheme – a FMIS, you may be able to claim a deduction for the payments. You can claim this if you;

  • currently hold a forestry interest in an FMIS or you held a forestry interest in an FMIS during the tax year

  • you have paid an amount to a forestry manager of an FMIS under a formal agreement

Note: Claiming a deduction is possible if the forestry manager has advised you that the FMIS meets the 70% direct forestry expenditure rule.

The ATO not only has a tax deduction for interest, dividend and other invest income expenses, but also offers tax deductions for job related costs such as;

That means when it’s time to lodge your taxes, you’ll be able to save money by claiming each deduction you are eligible for.

With the help of the E-Lodge.com.au, lodging is a simple process. Get started today and have your tax return completed in as little as 15 minutes!

It’s Easier With E-Lodge™

 18/4/2014 Photo via Nicki Mannix on Flickr

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