Whether you can claim or not will depend on the nature and extent of the repair work
What you can claim
If you have a rental property that is classified as a “leaky” property, you can usually claim deductions for repair work and general maintenance.
But there are some circumstances when the cost of repairs can’t be deducted:
- When the nature and extent of the work means it has gone beyond repairs, changing the character of the asset (or substantially the whole of the asset).
- When the work involves substantial reconstruction, replacement or renewal of the asset (or substantially the whole of the asset).
This kind of work is considered to be a capital improvement.
What is meant by asset
If your property is a standalone property that does not share any structural foundations or facilities with other properties, the asset is your property.
If your property is a unit of many in an apartment building or a large complex that shares structural foundations, walls, roofing, plumbing and other facilities with other units, the asset is the apartment building or the complex and not the individual unit.
This is important. If the repair work to your unit is part of a bigger project to repair the rest of the building, and the end result is a capital improvement to the building, you won't be able to claim deductions to work done to your unit.