Private ruling: Rent expense
Published: November 2011
Ruling period: Year ended 30 June 2011
Date scheme commenced: 1 July 2010

Ruling: Q1: Are you entitled to a deduction for rent? | A1: No.


Relevant legislative provisions: Income Tax Assessment Act 1997 Section 8-1

Reasons for decision: Summary: Section 8-1 of the Income Tax Assessment Act 1997 allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income except where the outgoings are of a capital, private or domestic nature, or relate to the earning of exempt income. In your case, you are renting out your former residential home and have rented a property in which you live. While we accept that the rent may offset the cost of renting in your current location, the expense of renting your current home is not incurred in producing the rental income from your former home. The expense of renting is a private expense and is not deductible.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet. | Relevant facts: You and your spouse moved from City A where you owned a home, to City B where you have rented accommodation. | You have rented out your home in City A until you settle and find a suitable house to buy.