| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your written advice
Authorisation Number: 1013126445028
Date of advice: 21 November 2016
Ruling
Subject: Rental property expenses
Question
Are you entitled to a deduction for the cost of leasing furniture for your rental property?
Answer
Yes.
This ruling applies for the following periods
Year ending 30 June 2017
Year ending 30 June 2018
Year ending 30 June 2019
Year ending 30 June 2020
The scheme commenced on
1 July 2016
Relevant facts
You are buying an apartment and wish to rent it out.
You want to offer the tenant the option of having a fully furnished or partly furnished apartment.
You wish to lease the required items such as dishwasher and furniture.
The items will only be leased if the tenant requires them.
All items will be used only in the rental property.
The items will not be used for private purposes.
The property will be rented at market rate.
Relevant legislative provisions
Income Tax Assessment Act 1997 - Section 8-1
Reasons for decision
Section 8-1 of the Income Tax Assessment Act 1997 allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature.
A deduction is generally allowed for expenses incurred in maintaining a rental property which is rented at market rates.
Where furniture or white goods are leased for the purpose of putting them into your rental property, the associated expenses are an allowable deduction. This is because the expenses are sufficiently connected to the earning of your assessable rental income. That is, the cost of leasing the items is helping you earn your assessable income.
Therefore you are entitled to a deduction for the cost of leasing furniture and/or white goods that are put in your rental property and used solely for the purpose of earning your assessable rental income.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
