Deducability of Expenses while Vacant

[davea]

Im just wonering about converting a PPOR into an IP, say the day i move out is the 30th June

If i advertise a property for rent say on the 1st of July and recieve 3 applications within say a few days with different dates they can move in

say on appliaction is the best of the lot but can not move in until 4 weeks time, say 29th July, would the 4 weeks of vacant time waiting for the right tenant still be deductible? Say if we signed a residential tenancy agreement on the 5th, im guessing i couldnt re advertise the property so its just going to sit vacant until i get the tenant.

I would think it would be a fairly straight forward answer if it was a newly purchased IP but a house being convered from a PPOR would complicate it maybe...

[DaleGG]

Hi

So long as the property is available for rent then the costs that you incur along the way when the property is vacant remain tax deductible.

Dale



Im just wonering about converting a PPOR into an IP, say the day i move out is the 30th June

If i advertise a property for rent say on the 1st of July and recieve 3 applications within say a few days with different dates they can move in

say on appliaction is the best of the lot but can not move in until 4 weeks time, say 29th July, would the 4 weeks of vacant time waiting for the right tenant still be deductible? Say if we signed a residential tenancy agreement on the 5th, im guessing i couldnt re advertise the property so its just going to sit vacant until i get the tenant.

I would think it would be a fairly straight forward answer if it was a newly purchased IP but a house being convered from a PPOR would complicate it maybe...

[Brenda Irwin]

I think the wording is 'available for rent'. If you are canvassing for tenants then the house is an IP and expenses deductable.

I would be making the applicant at least pay a deposit for you to hold it empty for them.

[davea]

I think the wording is 'available for rent'. If you are canvassing for tenants then the house is an IP and expenses deductable.

I would be making the applicant at least pay a deposit for you to hold it empty for them.

well it would actually be a family friend, we know who wants to go in there but their lease doesnt expire until end of july, the new PPOR settles end of June, so it will be available to rent (from say 1st July, after we clear everything out) but we would just wait for the 'prefered' tenant and want to make it seem legal in the eyes of the ATO...

thanks for clearing it up...

[Brenda Irwin]

well it would actually be a family friend, we know who wants to go in there but their lease doesnt expire until end of july, the new PPOR settles end of June, so it will be available to rent (from say 1st July, after we clear everything out) but we would just wait for the 'prefered' tenant and want to make it seem legal in the eyes of the ATO...

thanks for clearing it up...

Go on, make the friend cough up a $5 deposit and declare it on your tax. :)