Private ruling: Rental property - deduction
Date of advice: 9 January 2026
Published: 2 March 2026
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to claim the expenses you incurred for work carried out on your rental property's sewer as a repair deductable under section 25-10 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes.

Relevant facts and circumstances: On XX 20XX, you acquired an investment property. You are the sole owner of the property. You rented out the property immediately after settlement, managed by the local real estate agent. In early XX 20XX, the tenants identified a leak at the toilet base. A plumber attended the property and cleared the blockage temporarily. In late XX 20XX, the leak returned at the property. The plumber did a CCTV inspection of sewer and identified misalignment at the connection. The plumber temporarily cleared the sewer again and recommended the problem needed to be fixed urgently. The sewer was exposed and the damaged section was repaired by removal of the concrete slab and replacement of the affected sewer line. The repair works include: • Repair collapsed sewer drain • Repair further drain issues due to drain lifting and falling backwards • Concreting works You paid for all expenses incurred to repair the sewer. The total amount of expense to repair the sewer was $XX. The property has never been used for personal use during the entire ownership period. Your insurer covered the cost for a minor repair for the damage caused by the leak, and this amount will not be included in the expense claim.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 8-1 | Income Tax Assessment Act 1997 section 25-10