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Leaky apartment and tax returns

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  • Leaky apartment and tax returns

    I have the misfortune of being involved in a leaky apartment dispute.

    Anyway, the body corp has levied $6000 from each owner to setup a fund for legal fees.

    My question is, is this tax deductible?

    Also any reapirs that we need to do, can this be claimed as an expense also?

    Cheers

  • #2
    I am no expert LFCNZ, but I would say that all those costs are tax deductible They are a cost of running your rental business. If they are repairs and not an improvement then it is deductible, otherwise it will need to be depreciated. But I would expect leaky building repairs to be a deductible expense.

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    • #3
      On the contra, the legal fees relate to the capital of the business (the building) so may be non deductible.

      One would also have to be careful will leaky building repairs as are they repairs or improvements?

      Surely someone has run these type of costs past an accountant who has hopefully given them more than 1 minutes thought like I have.

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