For the tax year ended 30 June 2017 Elizabeth incurred the following expenses in respect to her rental property acquired on 3 July 2016:

A loan of $500,000 was taken out on 3 July 2016 for 20 years to purchase the house. Interest paid on the loan for the current tax year was $42,000. The borrowing expenses (including legal fees, loan charges etc.) were 58,000.

The roof of the house was found to be damaged at the time of acquisition and replaced at the time of purchase at a cost of $25,000.

One of the bedrooms in the house was repainted on 10 February 2017 at a cost of $1,200.

The timber floor in the outside laundry was replaced with a concrete floor on 1 April 2017 at a cost of $2,500.

It was required to be replaced because a hose had a leak and rotted the floor.

A gas water heater was purchased on 10 May 2017 for $2,300. The heater had an effective life of 6 years.

Required:

Advise Elizabeth as to what deductions (if any) she might be able to claim for the tax year ended 30 June 2017

Answer rating: 100% (QA)

Elizabeth may be able to claim the following deductions for the tax year ended 30 June 2017 Interest ... View the full answer