claiming travel expenses.

J

jonesy427

just a quick question. ive recently brought two units and plan on carrying out renovations early next year. currently tennanted, 6month lease (when one expires, renovate, the other will be renewed for a further 6 months, then renovated).
can i claim travel expenses?
would the renovation be classed as a repair?

extract from ato website - what you are not able to claim.
to carry out general maintenance of the property while it is not genuinely available for rent

so that makes me think that it is not deductable. but im also not carring out maintainence. what is their definition of maintainence?

so is anyone able to clear this up for me?
cheers
 
At best, you MAY be able to add travel expenses to the cost of the reno for CGT purposes, but an accountant will have accurate information.
Marg
 
Have the agent place the property on the market for rent.

I am sure that you will happily stop works if you have a tenant wanting to lease the property or finalise the works during/after the tenancy.
 
even after it has been tennented? i thought initial repair was when you buy, reno, rent out. please correct me tho cause im still new to this.
 
Last edited:
OK let me summarise it for you.

Travel will only be deductible if the work you are about to do is indeed ALSO deductible. So if you are traveling to renovate the property before it is leased out, then this will be a capital cost, which means that the travel is ALSO capital and cannot be deducted until you sell the place.

If, however, you were traveling to do general maintenance which is fully deductible, then your travel will also be deductible.
 
jonesy427 said:
even after it has been tennented? i thought initial repair was when you buy, reno, rent out. please correct me tho cause im still new to this.
Click to expand...

A repair once it is tenanted is fine - BUT as Aaaron_C says - that has to be the only pupose of your tip.

As I understand it, a repair can't bring the object back to a state that is better than it was prior to its "break down" - otherwise it is an improvement.

For instance, if there is a tear in the carpet, and you patch it up, it's a repair. If your replace the carpet, it's NOT a repair (it's an improvement - same as a reno)

The Y-man
 
so do they need it broken down into whats repair n what is a reno? so if i replace the kitchen - capital, patch hole in wall and paint - repair. then do i have to split it up or just claim it all as capital? sorry again for the silly questions.
 
this is getting more and more confusing by the day. at least time is on my side. i have roughly 7months until i plan on unertaking the renos/repairs. plenty of reading a question time.
cheers for the replies
 
Is the cost of cleaning up the property after initial purchase tax deductible or classified as initial repair and have to be capitalised? :rolleyes:
 
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