Hi, we need to replace the pool liner at our investment property. We've had the property for 6 months. Is that long enough to claim the expense as a deduction or would it still be an initial repair and therefore a capital expense?
thanks,
mellike for like is a deduction according to my accountant
If you replace the whole liner it is an improvement. Items replaced in their entity are not a repair. If you patched the liner that is a repair.
It is a grey area of tax law
this tax ruling covers this scenariohttp://law.ato.gov.au/atolaw/view.htm?docid=TXR/TR9723/nat/ato/00001
Also if you purchased the property with the liner in that condition it is being improved beyond the condition you purchased it at.
You can claim depreciation if it is deemed an improvement.
what shade of grey? Replacing the liner or the filter or cover etc is r&m, replacing the pool is capital.
Hi
This article might be of benefit to you. I wrote it for YIPmag.com.au
http://www.washingtonbrown.com.au/property-repairs
Regards
Tyron Hyde
http://www.washingtonbrown.com.authanks for the advice.
duckster: we have tried patching the liner but it keeps getting more holes- it is just at the age that it is full of pin prick holes so patching is infeasible. we're not replacing the whole pool so wouldn't this clasify as repair? pool liners need replacing every 10-15 years..
great article, tyron
It really boils down to did it need replacing at the time you bought the property? If yes, then it is capital, if no (ie you did not realise, or it has deteriorated quicker than you would have thought) then it would/could be a repair.
Cheers
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