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Re: Rental Payments for Private Residence

Newbie

Views 60

Replies 3

Hi,

I have a client that would like to claim rental payments for her private residence, i.e. she lives in her main residence and wants to claim rental expense in her tax return. 

Obvioulsy, this would mean that she would have to claim rental income and the property would be subject to capital gains based on the portion of space she is using compared to the house?

Thanks

Anthony

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

ATO Community Support

Replies 0

Hello @anthony_cez,

 

These expenses would not be tax deductable. The ATO would consider these expenses to be private in nature as the relate to her private residence which is not an income producing asset. 

3 REPLIES 3

ATO Community Support

Replies 2

Hello @anthony_cez,

 

Is you client renting out a portion of her home to a tenant?

 

  • If so, you are correct, she would be required to declare rental income on her tax return. If she charged her tenant under the market value, she is only able to claim a deduction up to the amount of rent she received.
  • You are correct, as she is using her home to produce an income while she is living in it, she will be required to pay CGT using the home first used to produce income rule for that portion when she sells.

 

  • If not, these expenses would be considered private in nature and not allowable deductions.

Newbie

Replies 0

No, the client owns the home and was looking at 'renting' it to herself.

Most helpful response

ATO Community Support

Replies 0

Hello @anthony_cez,

 

These expenses would not be tax deductable. The ATO would consider these expenses to be private in nature as the relate to her private residence which is not an income producing asset.