| Disclaimer This edited version has been archived due to the length of time since original publication.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: 1051427534886
Date of advice: 26 September 2018
Ruling
Subject: Rental property deductions
Question
Are you entitled to claim your share of the capital works deductions made to your rental property, due to storm damage in the 2018 income tax year?
Answer
Yes. Your capital works deductions meet the requirements of Division 43 of the Income Tax Assessment Act 1997. Further information can be found by searching ‘QC 21620’ on ato.gov.au
This ruling applies for the following period
Year ended 30 June 2018.
The scheme commences on
1 July 2017.
Relevant facts and circumstances
A short time ago you and your spouse (you) purchased a property (the Dwelling).
As soon as the dwelling was purchased you made it available for rent.
The Dwelling has been available for rent from the time it was purchased to the current date.
A number of years later a storm battered the Dwelling causing extensive damage to its roof. The damage to the roof of the Dwelling led to the interior being affected by storm water.
The Dwelling was available for rent when the storm damage occurred.
The Dwelling is insured.
You have not received any payments for loss of rental income or for any repairs made to the Dwelling from your insurance company.
The tenants continued to pay rent throughout the period the Dwelling was damaged and repaired.
You intend to claim the following amount as capital works deductions in your rental property schedule in your 2018 income tax return:
● The total of the capital works and building allowance expense for the 2018 income tax year is $XX, XXX.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 25-10
Income Tax Assessment Act 1997 Division 40
Income Tax Assessment Act 1997 Division 43