Hey there, I settled on a house in January. I spent $$$ performing maintenance in February. I also had interest costs in February. I rented it out in March. Are the costs in February tax deductible? Thanks!
The maintenance I would say is pretty unlikely, this would probably be considered an improvement and thus would be a capital expense (reduce cgt on sale later on). The interest and any rates etc, no worries. They are the holding costs of an asset which you have intention of producing a taxable income, so fully deductible (Steele's case)
Hiya, Coopranos is correct. After only owning the property for one month, it has not had time to deteriorate to a condition that warrants repairs. The basic rule of thumb is that any work done to the property that results in it being better than when you purchased it, will need to be capitalised and depreciated. However, expenses do become deductible as soon as you have purchased the property if your intention is to rent it out for income. Cheers James.
Don't forget valuations for depreciable fixtures & any capital allowances. They are your non-cash expenses that you claim deductions for. Cheers, Rob
