Private ruling: Rental expenses - repairs
Date of advice: 22 March 2021
Published: June 2021
Ruling period: Year ending 30 July 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are your expenses deductible as repairs? | A1: Yes. Your expenses meet the requirements in Taxation Ruling TR 97/23 Income tax: deductions for repairs and are deductible. Further information about repairs can be found by searching 'QC 55249' on ato.gov.au

Relevant facts and circumstances: Your investment property had been under an ongoing tenancy until a leak from the bathroom was reported by the downstairs neighbour. A plumber certified the leak during year ending 30 June 20XX. As a result, you did not renew the tenancy when it was due (X months after the leak was detected) in order to facilitate the repair. The plumber's inspection report indicated that water from the bathroom had started to leak through into the ceiling of the unit below due to the waterproofing in the shower failing. The contractor advised that the shower area required re-grouting, re-tiling and re-waterproofing in order to stop the leak. Other expenses included electrical reconnection and usage for the repair work, investigation costs and repairs for the damage caused to the unit below. The property was re-tenanted after the repair was completed (X months after the leak was detected).

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