Disclaimer
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 private advice

Authorisation Number: 1051826585594

Date of advice: 13 April 2021

Ruling

Subject: Carrying on a business

Question

Am I carrying on a business of renting properties?

Answer

Yes. From the information provided, you meet the definition of a 'business' outlined in section 995-1 of the Income Tax Assessment Act 1997 (ITAA 1997) and you meet the relevant factors contained in Taxation Ruling TR 97/11 Income Tax: am I carrying on a business of primary production? Considering your circumstances, we consider the activities you are undertaking to represent that of a business. Further information about carrying on a business can be found by searching 'QC 31733' on ato.gov.au.

This ruling applies for the following periods:

Year ending DD MM YYYY

The scheme commences on:

DD MM YYYYY

Relevant facts and circumstances

You own and rent X properties.

Each property generates a profit.

You spend X-X days per week carrying out the following tasks:

•         You interview all prospective tenants and draw up leases.

•         You conduct all maintenance unless a professional is required.

•         You arrange maintenance if a professional is required.

•         You arrange smoke alarm testing.

•         You conduct all gardening which includes mowing, pruning and replanting.

•         You conduct all maintenance of the exteriors of each property which include cleaning of driveways, patios, paths and exterior walls.

•         You conduct regular inspections of the properties.

•         You conduct final cleans and inspections of all properties including preparation of required condition reports including being available for key changeovers.

•         You prepare and distribute notices, advices for rent increases and entry requests for inspections.

•         You liaise with the Residential Tenancies Authority (RTA) providing all required documentation and lodgement of rental and bond income.

•         You attend RTA seminars regarding managing rental properties.

•         You provide own equipment including truck, trailers, chain saws and building tools for the maintenance of the properties.

•         You are on call to the tenants and can be contacted directly.

Relevant legislative provisions

Income Tax Assessment Act 1997 section 995-1

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).