are these fees tax deductable?

[WebBoard]

From: M O N T O


I had sent a building inspector to inspect a property and as a result I didn't buy the property due to the amount of repair required. Is the fee on the building inspection that the deal didn't go through still tax deductible? Similarly, valuation and solicitor's fees that resulted an unsuccessfully deal, are they deductible and how are they claimed if deductible?

cheers
Matt

 

[DaleGG]

Reply: 1
From: Dale Gatherum-Goss


Hi

I would claim these tax items as a tax deduction because they were incurred in trying to earn an income from property investing. If you had gone ahead, they would not have been because then they would have related to the cost of buying the asset.

Of course, it is even easier to claim if you have a business of property investing through a trust, or business structure.

Dale

 

[WebBoard]

Reply: 2
From: Mark Petterwood


Hi,

Firstly I am not an accountant but I do invest in property and I also help people to invest in property.

I work in an Accountant's firm and I ran this question past one of the Accountants (who has 5 properties himself)

He said that if you are not a business carrying on the activity of investing in property then you really should not be claiming any expenses that do not lead to the purchase of a property.

Also, any expenses that are incurred in the purchase of a property will usually have to be included as capital costs.


Hope this helps


Regards


Mark