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Edited version of private advice
Authorisation Number: 1051873618300
Date of advice: 22 July 2021
Ruling
Subject: Rental deductions
Question
Are you entitled to a deduction for the cost of replacing the roof of your rental property as a repair?
Answer
Yes. Your expenses meet the requirements in Taxation Ruling TR 97/23 and are deductible. Further information about repairs can be found by searching 'QC 23635 on ato.gov.au
This ruling applies for the following periods:
Year ended 30 June 2021
Year ending 30 June 2022
The scheme commences on:
1 July 2020
Relevant facts and circumstances
You purchased the property as joint tenants with two other individuals in XX.
Both of the other owners are now deceased. You are the sole owner of the property.
The property has been rented out and will continue to be rented out.
When you purchased the property, the roof was in good condition.
Over the years, the roof has deteriorated due to severe weather conditions.
You engaged a roof contractor to conduct the roof restoration. It was identified by the roofing contractor that there is substantial rusting on various sections of the roof causing leaks and the replacement of the whole roof is required.
The works carried out is as described:
• Remove existing gutters, roofing and flashings.
• Remove existing fascia and support purlin.
• Supply and install new fascia purlin and outrigger support purlins.
• Supply and install.48 Zincalume roof sheeting and flashings as needed.
• Supply and install new Colorbond Squareline gutter and PVC downpipes to existing ports only.
• Allowance for edge protection to perimeter of building as needed.
• Allowance to dispose of existing roof, flashings and scrap metals from job.
The original roof has been replaced with a modern equivalent of Zincalume.
The roof restoration is currently underway and is due to be completed by XX.
You have incurred expenses for the cost of the roof restoration over two financial years. You paid an instalment in XX and the balance is to be paid when the work is completed.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 25-10