Asbestos Fencing

[HD_ACE]

So I have received a request from a neighbor to an ip of mine to split the cost of replacing a fence which is apparently in disrepair.

Its only one boundary (41m) of asbestos fencing to be replaced with a new colourbond fence.
My question is due to the asbestos/safety issues involved would it then be classed as a repair for tax purposes? Or only depreciated accordingly?

Or what are the requirements/proof needed?

cheers

 

[depreciator]

It's not a 'repair', but the government are keen to get asbestos out of the environment so you should be able to claim the cost of getting rid of it and probably the cost of the replacing it with the nearest modern equivalent - colorbond should be fine.
Coastymike made a post earlier this year and included a reference to and Ruling where a taxpayer was about to claim the cost of replacing an asbestos roof. Do a search and you might find that Ruling for reference.
Get photos and make sure you use a registered contractor who writes on the invoice that he was engaged to remove a damaged ('friable' would be the word to use) asbestos fence.
Of course, you will talk to your accountant about this.

 

[S.T]

BMT had some info about it in one of their latest publications

http://www.bmtqs.com.au/documents/publications/mav34.pdf

 

[HD_ACE]

Thanks guys i will follow it up with my accountant.

Cheers

 

[Paul@PFI]

..."split the cost of replacing a fence".......You have answered your own question.

This is capital expenditure and is not deductible for 41 metres of fencing. Asking someone here who says "Yes" wont change the facts. Fencing is more than the panels. Posts, Rails etc... If all of that is replaced there is no dispute. Its a replacement. Its capital expenditure. Doesnt matter that the former fence is stuffed. But if only the surface sheeting (absestos) only was replaced due to damage I would consider it "repairs".

Asbestos has been a prohibited construction material for a long time. 40+ years.

A fence contractor cant remove asbestos !! Only a licensed asbestos contractor can. Its your mesothelioma if they do.

 

[speary]

Under s40-755 of the ITAA 1997 you should be able to claim a deduction for your share of the removal of the asbestos fence as per ATO ID 2004 /720.

As Paul mentioned above, the cost of the fence is an improvement and will likely be considered capital works and deductible over 40 years.

Ben

 

[Singo]

So if a breakdown of costs is obtained, the asbestos removal part can be deducted, isn't it?

 

[speary]

You would probably use a licensed asbestos removal company to remove the fence, then use a fencing company to put up the new one. Therefore you would probably have two separate invoices.

 

[Singo]

Well, there are fencing companies who have asbestos removing licence. And giving both jobs to such company is cheaper I reckon. We also have an asbestos fence, thus interested to know.

 

[speary]

Cool, I didn't know there were companies that did both, I'll definitely keep that in mind when I replace mine. Definitely get it itemised on the invoice then.

 

[HD_ACE]

..."split the cost of replacing a fence".......You have answered your own question.

This is capital expenditure and is not deductible for 41 metres of fencing. Asking someone here who says "Yes" wont change the facts. Fencing is more than the panels. Posts, Rails etc... If all of that is replaced there is no dispute. Its a replacement. Its capital expenditure. Doesnt matter that the former fence is stuffed. But if only the surface sheeting (absestos) only was replaced due to damage I would consider it "repairs".

Asbestos has been a prohibited construction material for a long time. 40+ years.

A fence contractor cant remove asbestos !! Only a licensed asbestos contractor can. Its your mesothelioma if they do.

the entire fence is just sheets of asbestos no posts or rails therefore only the asbestos is being replaced. I do agree its of capital but was not sure how the whole asbestos side of things effected it.
The quotes are seperated into new fence and asbestos removal

cheers

 

[depreciator]

I still reckon there is a chance you could claim the removal AND the new fence as a deduction. It's worth pursuing.
Get a Private Ruling. It's easy, and at this time of year pretty quick. When you apply for a PR, they ask you to outline the scenario. They also whether you have any reference that might be relevant. Dig out that Ruling that Coastymike mentioned where a person was allowed to claim the whole cost of removing an asbestos roof and replacing it.
Let us know what the ATO say.

 

[Paul@PFI]

I would assume none is deductible until a ruling indicates otherwise. If you dont ask, you dont get.

I would consider that the removal is seperate but preliminary activity. I say seperate as its also an an essential one. ie : Is there a council order ?? That could trigger a different CGT issue. Maybe you need to ask council if you are allowed to keep the asbestos fence and see what they say !! (I know their answer) Good chance that the removal may be deductible if its presented right.

 

[Paul@PFI]

The thread depreciator refers to is titled "roof replacement"

 

[HD_ACE]

Hmmm interesting. I will look into it further.

Thank you all.

Cheers

 

[HD_ACE]

Under s40-755 of the ITAA 1997 you should be able to claim a deduction for your share of the removal of the asbestos fence as per ATO ID 2004 /720.

As Paul mentioned above, the cost of the fence is an improvement and will likely be considered capital works and deductible over 40 years.

Ben

After digging deeper the above info seems to be the correct answer.

Cheers