Hi all,
We are looking to renovate the bathroom in our rental property
I understand that this will be treated as a capital expense so we would depreciate the assets over time.
I have two questions:
1. Are we able to claim the cost of the labor – plumber etc?
2. If we utilise a credit card to purchase some of the tiles, etc. is the interest tax deductible until we pay it off?
Appreciate any help with this.
Thanks,
John
as all of the work forms part of a project, the works need to be depreciated. You can’t depreciate demolition, this might be an expense.
Interest should be deductible but it might be difficult to separate your personal expenditure from your ip on your card as you can’t quarantine repayments. You may be better served by using your line of credit.
yes, I think it would be a capital expenses and so you could only claim depreciation.
The interest on any loan used for an investment may be deductible – but be careful not to have other non deductible expenses on the card or it will get messy.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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