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Re: investment property - self done renovation

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I'm new

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Hi

We purchased a very old house and put it in the market for rent.

However, the walls and ceiling were so dirty and worn, so we bought the materials, paints, etc. and painted the property and did some minor renovations in the kitchen and bath ourself (to make it cleaner to attract tenants).

 

Can we claim the amount we paid for buying the materials and also claim the time we spent on doing the job (as if we have asked a painter/trademan to come and do the job)?

 

Thank you

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ATO Certified

Devotee

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Hi @Alex3 

 

First, you can't claim a deduction for the time you spent working on the property yourself because it didn't actually cost you anything (except time).

 

In terms of the cost of the materials and paint etc, it sounds like the work you did was before you started renting the property and if that's the case then these costs can't be claimed as an immediate deduction, but can be claimed over time as capital works deductions. Capital works expenses you incur also form part of the cost base of your property for capital gains tax purposes.

 

JF

 

This is my personal view; I’m an ATO employee who chooses to help out here in my own time.

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Best answer

ATO Certified

Devotee

Replies 0

Hi @Alex3 

 

First, you can't claim a deduction for the time you spent working on the property yourself because it didn't actually cost you anything (except time).

 

In terms of the cost of the materials and paint etc, it sounds like the work you did was before you started renting the property and if that's the case then these costs can't be claimed as an immediate deduction, but can be claimed over time as capital works deductions. Capital works expenses you incur also form part of the cost base of your property for capital gains tax purposes.

 

JF

 

This is my personal view; I’m an ATO employee who chooses to help out here in my own time.

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Devotee

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Hi Alex3,

 

JamesF is right, not only are "repairs" done pre renting not deductible (both materials and your time), "repairs" are only repairs to the extent they get the house back to the standard it was in when you purchased the property. If it was run down when you purchased it, fixing it will never be a tax deductible repair.