Private ruling: Income tax - deduction for repairs
Date of advice: 22 July 2025
Published: 22 September 2025
Ruling period: Year ended 30 June 20YY
Date scheme commenced: August 20YY

Ruling: Q1: Are you entitled to a deduction under section 25-10 of the Income Tax Assessment Act 1997 (ITAA97) for the special levies paid in the years ended 30 June 20YY and 30 June 20YY that were used for the work carried out on the parapet/façade? | A1: Yes. The work carried out on the parapet, which is a subsidiary part of the building, was a repair to the building as the work did not change the building's character and restored its original functionality. You paid special levies in the years ended 30 June 20YY and 30 June 20YY that were used to pay for those repairs.

Relevant facts and circumstances: You own a Lot X in Strata Plan X at location (Lot X). The Strata consists of several lots in a commercial building. You purchased Lot X more than X years ago and it has remained tenanted as a commercial rental property since this time. The building is a heritage property in a heritage conservation area and protected. In 20YY it was detected that the façade was leaning forward with the potential to fall. An engineer's report confirmed that the building required immediate attention and that it needed to be made safe. As the building is heritage listed, the council had stringent requirements on all work that was carried out. A specialist heritage architect was engaged with recommendations to allow for the repair of the parapet of the building. You have provided details of the work undertaken, the cost of that work, and the amount of special levies that you paid.

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