Purpose
This guide helps the Acquisitions team confidently respond to client questions about whether our buyer’s agency fees are tax-deductible.
We do not give tax advice. However, we can share what other clients have done after consulting with their own accountants.
Suggested Script
"Mr./Mrs. Customer, this is a great question—and one that’s best answered by your accountant. But what I can share is what I’ve seen some of our customers do after speaking with their own accountants."
Common Scenarios Shared by Clients
Scenario A: Client Already Owns Investment Properties
Some clients have been advised by their accountant to:
- Treat the first half of the fee as a tax-deductible expense for managing their existing portfolio.
This part of the service includes portfolio review, strategy guidance, and market analysis.
- Add the second half of the fee to the cost base of the new property.
This reduces the capital gains tax (CGT) liability when the property is sold.
Note: Not all accountants agree with this approach. It should always be confirmed by the client’s accountant.
Scenario B: Client Has No Prior Investment Properties
If the client is buying their first investment property through InvestorKit:
- The entire fee is often added to the cost base of the property.
- This means the fee is not deducted immediately but can reduce CGT upon sale.
Guidance to Give Clients
Encourage clients to:
- Speak with their accountant about the fee breakdown.
- Describe the nature of our services, particularly if they include portfolio planning or market review.
- Keep all receipts and invoices to support future tax claims.
Important Reminders
- Do not say the fee is deductible.
- Do not recommend any particular tax treatment.
- Do refer to what clients have done in the past.
- Do encourage discussion with a licensed accountant.