Announcements
Worried you’re missing part of your refund? Remember, the low and middle income tax offset isn’t a refund on its own – it’s used to offset (or reduce) the amount of tax you pay. The offset amount you may be entitled to is automatically applied and could range between $255-$1080, depending on things like your taxable income and how much tax you’ve paid.
Still not sure? Ask the Community

ATO Community

Re: Replace a boiler of an air conditioning system - repair or capital expenditure?

Newbie

Views 111

Replies 3

We've just replaced the boiler of an existing air conditioning for one of our commercial rental properties. The cost of replacing the whole boiler is around $200k. There is no improvements/upgrades in functions. As it is part of the airconditioning, would it be considered as a repair or a capital expense? 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

ATO Community Support

Replies 0

Hi @GraceZHR,

 

If you are leasing a commercial property we have information on our website about income and deductions. We also detail what is looked at as repairs/maintenance and improvements. Whether the boiler is a repair or an improvement (depreciable item) you will need to consider the information on the website.

 

You can also use our legal data base on Rental Properties for future assistance and guidance.

 

Please use the links to assist you in making that determination.  

 

All the best.

3 REPLIES 3

Community Manager

Replies 2

Hi @GraceZHR 

 

Just to clarify, what was the reasoning behind replacing the boiler of the existing air conditioner?

 

Check out our Tax Time toolkit for rental repairs  - this might help you work out which condition the new boiler falls under.

Newbie

Replies 1

Thanks Emily,

 

The reason of replacing the boiler is the old boiler was broken and cannot be repaired.

 

Accroding to the reference chart, this should be claimed as a repair?

Most helpful response

ATO Community Support

Replies 0

Hi @GraceZHR,

 

If you are leasing a commercial property we have information on our website about income and deductions. We also detail what is looked at as repairs/maintenance and improvements. Whether the boiler is a repair or an improvement (depreciable item) you will need to consider the information on the website.

 

You can also use our legal data base on Rental Properties for future assistance and guidance.

 

Please use the links to assist you in making that determination.  

 

All the best.