Replace roof on purchase – capital or R&M

Capital.

If anything is done to improve the property above it’s condition at time of your purchase then it is classed as capital. Regardless if someone else was renting it out it all starts fresh from your purchase.

You will be able to claim depreciation on the repair.

if however damage was caused after the purchase then a repair might be in order. Not normal wear and tear but storm damage or the like.

Your accountant will be better able to advise you.

Simon Macks
Residential and Commercial Finance Broker
[email protected]
0425 228 985

Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

Hi Lisa. I did a bit of looking into this a while back, and after printing out and reading a heap of material from the ATO, while of course it may be open to interpretation, a roof repair, as long as it is that, which may involve replacement of all sheeting, and keeping old gutters etc could be justified as such (check yourself, don’t take my word for it….) as long as it is replaced with similar or same should be ok…HOWEVER in your case, that is irrelevant as unfortunately even if you leave the ‘repair’ for a while, it will count as an ‘initial repair’, which is a capital cost, as the ATO information alludes to the fact that it should have been reflected in the house purchase price. So, you have a big item to depreciate it looks like! All the best.[strum]