Private ruling: Sub-letting of own apartment
Date of advice: 3 June 2019
Published: July 2019
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to apportionment of expenses for a property that is sub-let for shorter periods during the year, for the entire time that it was available for rent? | A1: Yes Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 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. Accordingly, it follows that you will be eligible to deduct your property expenses when it is available for rent, and apportion the area of the property which is used for storing your private property, which is private in nature. | Q2: If the total revenue from sub-letting is less than the apportioned costs are you entitled to claim a rental loss? | A2: Yes

Relevant facts and circumstances: You sublet your apartment occasionally using the sharing economy for parts of the year. When you advertise the apartment for rent, you completely vacate the apartment with the exception of a small bedroom where you lock your personal goods and effects. You let the apartment at market rates and advertise it widely. The property is always let for part of the time advertised; you rarely have it let for the total time available.

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