You can claim a deduction for repairs and maintenance to machinery, tools or premises you use to produce business income, as long as the expenses are not capital expenses.shutterstock_108676571

What you can claim

You can claim the cost of allowable repairs and maintenance, including:

  • painting;
  • conditioning gutters;
  • maintaining plumbing;
  • repairing electrical appliances;
  • mending leaks;
  • replacing broken parts of fences or broken glass in windows; and or
  • repairing machinery.

To repair something means to fix defects, including renewing parts. It does not include total reconstruction.

You do not have to own the property or item that is repaired in order to claim a deduction.

What you can’t claim

You can’t claim capital expenses, such as:

  • substantial improvements to an item or property – for example, installing a new ceiling; or
  • repairs made to machinery, tools or property immediately after you purchase or acquire them – this is because the price you paid reflects the item’s condition.

You can generally claim a deduction for capital expenses under the general depreciation provisions (for items), or the capital works provisions (for property).

Building improvement costs, and capital works deductions claimed, would also be taken into account when working out a capital gain or loss on disposal of the property.

More information? To find out more, give us a call on 1300 023 782 or email team@cdrta.com.au.

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Craig is the principal consultant of C&D Restructure and Taxation Advisory and has been working in the industry since 1999. Having established C&D Commercial Partners in 2015 the precursor to the current business.

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Post Author: Craig Dangar

Craig is the principal consultant of C&D Restructure and Taxation Advisory and has been working in the industry since 1999. Having established C&D Commercial Partners in 2015 the precursor to the current business.

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