Private ruling: Rental repairs
Date of advice: 20 February 2026
Published: 13 April 2026
Ruling period: Year ended 30 June YYYY
Date scheme commenced: DD MM YYYY

Ruling: Q1: Can you immediately deduct expenses you incurred to undertake repairs to damaged and deteriorated parts of your rental property (the property) under section 25-10 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes. The need for repair was a result from the property being tenanted and are not considered of a capital nature. Section 25-10 of the ITAA 1997 states you can deduct expenditure you incur for repairs to premises (or part of premises) or a depreciating asset that you held or used solely for the purpose of producing assessable income. The amounts included in your application are considered repairs.

Relevant facts and circumstances: On DD MM YYYY, you jointly purchased the property. From purchase until MM YYYY, you used the property as your main residence. In MM YYYY, you advertised the property for rent with rental agent A. For a period, long term tenants resided at the property. On DD MM YYYY, you received a remote inspection report from rental agent A stating there were no issues with the property. You received a condition report of the property when you originally commenced renting it. You lost access to this original report when rental agent A merged with another agency. After the tenants exited the property, you identified the need for repairs. From DD MM YYYY until the property was sold, the property remained vacant. On DD MM YYYY, you received correspondence from your rental agent A stating that because the tenants had moved in nearly XX years prior there was no report to compare the exit inspection report to and some of the items may have been present at the time the tenants moved in. In early MM YYYY, you requested rental agent A to obtain a quote for either repairing and restoring the property to re-let or preparing the property for sale. In or around MM YYYY, you hired the company A to commence works on the property (exclusive of GST). You provided the itemised list of the works completed and stated which items you were seeking a ruling on. The total amount payable was $XX (inclusive of GST). You paid the full amount within the applicable income year. On DD MM YYYY, you sold the property.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 25-10