Intention, Design, and Materials
Understanding what separates repair or maintenance
work from an improvement requires asking yourself the right questions prior to
Am I fixing or enhancing this?
How will what’s about to be done change what
Those are simply the initial questions.
Being able to take a step back from the situation
and assess how you’re going to execute the job, and what materials you’re going
to use, is just as crucial.
Because while you might want to carry out
maintenance work with the peace of mind that it will be claimable on your tax
return, you don’t want to give something a new-angled character, functioning or
Filling in the cracks in a wall and giving it a
fresh coat of paint is very different to rendering the wall for the first time.
Knocking the wall down to create an open design
plan will also substantially change the look or character of a property, rather
than only remedy the faults it might have, so the costs of such a job will
largely not be accepted as a tax claim by the ATO.
Generally, when approaching a repair or any
maintenance work, you want to look at what the damaged or deteriorated
structure is already made of and use similar – if not the same – materials.
But this doesn’t mean you can’t do both
improvements and repairs in the one job and then separate the two categories.
As long as you can provide proof of which part of
the job mended something that was damaged and which part of the job enhanced
it, you may still be able to secure a tax claim on the repaired portion of the
Builders, painters, electricians, and other
professionals can provide an itemised invoice upon request, which will break
down each part of the work they have executed, allowing you to separate the
costs of the improvements from the costs of the repairs and maintenance work
when lodging you claim.
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Monday, 28 June 2021