Are Buyers Agent Fees Tax Deductible for Investment Properties?

How do I claim buyers agent fees on my tax return?

Buyers agent fees for investment properties are typically classified as a deductible expense because they relate directly to earning assessable income from your investment property. You can claim the full fee (including both the $4,000 upfront booking fee and the 2-3% settlement fee) as a deduction in the financial year you incur the expense.

Keep all invoices and receipts from our service for your tax records. Your accountant will need these documents to substantiate your claim with the ATO.

What's the difference between investment and owner-occupier properties?

The tax treatment depends entirely on how you'll use the property:

• Investment properties: Buyers agent fees are generally tax deductible because the property generates assessable income. You're purchasing the property to earn rental income, so costs associated with acquiring it (including our fee) are typically deductible.
• Owner-occupier properties: Buyers agent fees are typically NOT tax deductible because your home doesn't generate assessable income. You can't claim expenses related to acquiring a property you'll live in yourself.

How much can I save with tax deductions?

The actual tax benefit depends on your marginal tax rate. For example:

• On a $1M investment property with our 2% fee ($20,000 total), an investor in the 37% tax bracket could save approximately $7,400 in tax
• On a $1.5M investment property with our 2% fee ($30,000 total), the same investor could save approximately $11,100 in tax

These are illustrative examples only. Your actual tax benefit will depend on your individual circumstances, income level, and other deductions. Always consult your accountant or tax advisor for personalised advice.

What records do I need to keep?

To claim buyers agent fees as a tax deduction, you'll need to keep:

• Invoice for the $4,000 booking fee
• Invoice for the remaining fee paid at settlement
• Proof of payment (bank statements, receipts)
• Documentation showing the property is for investment purposes
• Records of when the expense was incurred

We provide detailed invoices for both the booking fee and settlement fee, making it straightforward for your accountant to process the deduction.

Can I claim other property buying costs?

Yes. Beyond buyers agent fees, investors can typically claim other costs associated with purchasing investment properties, including:

• Building and pest inspection fees
• Conveyancing and legal fees
• Loan application and mortgage broker fees
• Depreciation reports
• Ongoing property management fees

However, stamp duty and other government charges are typically treated differently (added to the property's cost base for CGT purposes). Your accountant can advise on the best tax treatment for each expense.

Should I engage a buyers agent even if I'm not sure about tax deductions?

Absolutely. The tax deductibility is a bonus benefit for investment property buyers, but it shouldn't be the primary reason to engage us. Our clients save an average of $65,000 through expert negotiation, gain access to off-market properties, and avoid costly mistakes during due diligence—all of which provide value regardless of tax treatment.

For investment properties, the tax deduction simply enhances the overall value proposition. For owner-occupiers, the fee still typically pays for itself through negotiation savings and professional representation.