Taxation Question- Expenditure Classification

[Bananaman]

Hi

I’m Looking to have some AAM input regarding the classification of expenditure I incurred this year on a rental property.

Earlier this year I purchased a rental property, let it immediately on a short term basis. It became clear that the property required repair, the tenant complaining of bad electrics, faulty boiler, smell of damp etc a comprehensive repair/renovation job was required.

The following works have been completed:

Rewire
Re Plumbing including boiler change
Window replacement
Insulation (wall and attic)
New fitted kitchen and appliances
New bathroom and tiles
New floors
Associated plaster repair and painting.

The question is, for tax purposes what bucket would such expenditure fall into, Fixtures and fitting over 8 years, expense fully allowed this year or capital.

I’m thinking that I should be able to write most items off over 8 year with possibly the plastering and painting down as a deduction against this years expenses, I don’t view these as being a capital expense as most will have a defined life span, for example the kitchen etc will likely need to be renewed in a number of year’s time.
Any advice appreciated.

Thanks

 

[dublin66]

There are a lot of questions here and I'm not sure you will get an answer. You have either of two choices - either go to an accountant who specialises in tax or a tax consultant or get hold of a book like Irish Income Tax by McAvoy & Associates.

There are very subtle distinctions between what is allowable as a repair, what is allowable as fixtures & fittings and what you will get no income tax relief for. Generally anything that is part of the building will not qualify as fixtures and fittings and will only be an allowable CGT deduction on a future sale. It can't be assumed that all expenditure will qualify for a tax deduction.