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NewUser2020-1(Initiate)Initiate
13 July 2022

I'm trying to determine where the line sits regarding 'repairs and maintenance' and 'capital works' when it comes to replacing inefficient appliances with more efficient ones and upgrading rental properties for tenants (adding heat pumps, solar etc).


I assume the hot water system would need to be 'functionally broken' to be able to be replaced, not just replaced becuase of sediment/annode dissolving and end of life actions occuring in the system?


I would expect that, as an example, if you had to replace a hot water system, the systems would improve in efficiency over the years so does that come into play or just the basics of "is it a hot water system replacing a broken hot water system yes/no" or does it come down to "is it the exact same type of hot water system- (eg. gas storage (old) to gas storage (new) vs gas storage (old) and gas instantaneous (new)


I have a lot of follow on questions around this topic as research - trying to understand some of the barriers to efficiency from a landlord's/tax perspectives after seeing the state of a lot of tenanted homes in my area.



7,338 views
2 replies
7,338 views
2 replies

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Most helpful reply

Bruce4Tax(Taxicorn)Taxicorn
13 July 2022

New HWS = depreciation item


Reason for change generally not relevant.


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Repairs/Maintenance or Capital Works when replacing or upgradin hot water system in rental property | ATO Community