RENTAL PROPERTY: ARE LEGAL FEES DEDUCTIBLE?
The answer is maybe. It really depends on your circumstances.
- you are in the business of renting properties, and
- your total legal expenses for the income year are $10,000 or less
then you can claim legal fees. If they are over the $10,000 mark… well, in rental residential property that is highly unlikely!
Please see this page at IRD for more info; remember though it is only talking about rental residential property, as different rules apply for property traders/developers.
As always, if you would like more information or are not sure about your situation, please contact us.
NB: If you are a property developer or trader, and therefore paying tax on the net profits from the sale of your buildings, then legal fees are one of the things you can claim.