Private ruling: Deductions - rental property
Date of advice: 24 November 2023
Published: 8 January 2024
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: In relation to an investment property held by you, would amounts relating to labour and costs for a bathroom rectification be fully deductible as a repair? | A1: Yes. The Commissioner accepts that these costs are deductible as repairs. Further information about claiming deductions for repairs can be found by searching ato.gov.au for QC 23635.

Relevant facts and circumstances: You purchased a rental property (the property). You have full ownership of this property. The property has been rented for some time and has never been used for private use. The property is managed by a property manager. The property was genuinely available for rent the year the costs were incurred at market rates. Rectification works were required to the bathroom due to damage to floor spaces and other areas. Due to the damage to the bathroom, the following works were undertaken: • The removal of pre-existing fixtures and fittings • The replacement of bathroom tiles • The installation of newly purchased bathroom fixtures and fittings. You have an invoice for the cost of the materials totalling $XX and an invoice for the total cost of the labour performed totalling $XX. The amounts relating to labour and costs for a bathroom rectification do not include amounts for the acquisition or installation of depreciating assets.

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