Q:
Is furniture purchased for tenant considered as direct expense?
A:
If it is an initial purchase of furniture for tenant, it cannot be considered as maintenance cost or direct expense. It can only be considered as maintenance cost when the furniture has worn out and needs to be replaced because replacement is considered as maintenance and deductible as direct expense.
Q:
If a newly acquired sub-sale property requires repair works, would the repair costs incurred be tax deductible?
A:
No, if the property has not been rented out before, then the initial repair costs incurred during the vacant period are not tax deductible, but they can be used for RPGT purpose.
If the property is being rented out and there is a need to repair the property, then the repair cost is deductible against the rental income.
Zen Chow
YYC Tax Guru
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