As a landlord, understanding who is responsible for appliances in your rental property is essential. If you have an oven with an electrical fault, your gas appliances need to be serviced, or your tenants have broken the fridge, you might be wondering who needs to foot the bill.
The rules are different depending on which state your property is in, so it’s important to get up to speed on your obligations quickly. In this blog, we’ll explore how to comply with the relevant rules and regulations and how to qualify for tax deductions.
What appliances are required in a rental property?
Your obligations for providing and maintaining appliances vary. There’s also an important distinction between appliances you’re required to provide and what you’re required to do once you’ve provided them.
Put another way, if you do provide some of the white goods for your tenants, you’re generally responsible for ensuring they function safely, even if you weren’t required to provide them.
Let’s look at your requirements:
Victoria
- No requirement to provide specific white goods, but if you do they need to be in “good working order.”
- For rental agreements after 29 March 2021, the kitchen must have a stovetop with “two or more burners” in “good working order.”
- No requirement to provide laundry facilities but, if you do, it must be connected to a “reasonable” supply of hot and cold water.
New South Wales
- No specific requirement to provide a stovetop or oven.
- Must have electricity or gas with sufficient sockets for lighting, heating, and other appliances.
Queensland
- Kitchen must have a kitchen space with a functioning stovetop.
- No requirement to provide white goods such as ovens and fridges.
South Australia
- Must ensure there is space and a designated water supply for a washing machine.
- Must have space for an oven and cooktop, with adequate kitchen bench space and a food storage cupboard.
Tasmania
- Must have an area for cooking, which must have a sink, hot and cold water, a stove top, and an oven.
Australian Capital Territory
- No specific minimum standards for providing appliances.
- Any appliances you provide must be in a reasonable state of repair.
Northern Territory
- No minimum standards for providing appliances.
Western Australia
- No legislation stating that landlords must provide appliances, but that has been under review.
Are landlords or tenants responsible for buying and maintaining appliances?
Although requirements for providing appliances are relatively light, for appliances you do provide it’s expected that you keep them in good working order. That will mean organising regular maintenance and speedy repairs when things go wrong.
As with the rules on providing appliances, your responsibilities depend on your state or territory:
Victoria
Responsibilities
- Tenants aren’t liable for fair wear and tear, but they are for damage caused by negligence, misuse, or intentional acts.
- You must ensure appliances provided with the property at the start of the tenancy are in good condition (note: you can’t waive this responsibility in your tenancy agreement).
Everyday Repairs
- Your tenants should submit a written request, which you’re required to address within 14 days. Otherwise, your tenant can ask Consumer Affairs Victoria for help or apply to the Victorian Civil and Administrative Tribunal (VCAT) for a repair order.
- You must ensure gas and electrical installations and fittings are checked every two years by a licensed professional. It’s best to keep careful records.
Urgent Repairs
- For issues that render the property uninhabitable or unsafe, tenants should notify you.
- If you don’t address the issue, they can arrange repairs themselves up to a value of $2,500, which you are required to reimburse within seven days.
New South Wales
Responsibilities
- Tenants are responsible for any damage they cause.
- Tenants must return the property to you with appliances in the condition they received them, except for fair wear and tear.
Everyday Repairs
- Tenants should get your consent before carrying out repairs themselves.
Urgent Repairs
- If tenants inform you that an appliance needs urgent repair, you need to carry it out in a reasonable amount of time.
- If you don’t respond, tenants can arrange repairs themselves and claim back costs up to $1,000.
Queensland
Responsibilities
- You must keep appliances supplied with the property in good repair.
- You can’t transfer your responsibilities to the tenants.
Repairs
- Address any repairs within a reasonable timeframe.
- Otherwise, tenants can arrange repairs themselves up to a value of four weeks’ rent, which you are required to reimburse in seven days.
South Australia
Responsibilities
- You need to keep appliances in a reasonable state of repair.
- Tenants are not responsible for damage caused through genuine accident or fair wear and tear.
Repairs
- Tenants should notify you of necessary repairs.
- If you fail to carry them out, tenants can arrange repairs themselves and “recover the cost” from you in addition to compensation for “damage they have suffered as a result of the failure to repair.”
Tasmania
Responsibilities
- You must maintain the property as close as possible to the condition it was in at the start of the tenancy.
Repairs
- If urgent repairs are required, the tenant should inform you but, if you don’t respond within a reasonable time, they can have the repairs carried out by a nominated repairer.
- You then have 14 days to pay the costs.
Australian Capital Territory
Responsibilities
- Under the Residential Tenancies Act 1997, you must maintain the property in a “reasonable state of repair”.
Repairs
- If you need to replace an appliance, ensure the replacement has at least the same energy efficiency rating.
Northern Territory
There are no specific provisions on appliances, but under the Residential Tenancies Act 1999, you must maintain your property in a reasonable state of repair and ensure that any fittings are safe.
Western Australia
There are no specific rules on appliances, but under the Residential Tenancies Act 1987 your property must be in a reasonable state of repair, fittings must be safe and operational, and you need to ensure your property has at least two Residual Current Devices (RCDs) to protect power points and lighting circuits.
What appliances do tenants expect in a rental?
Just because a property meets the minimum legal standards, that doesn’t mean it’s going to attract good, high-paying tenants.
One survey found that 24% of renters expect appliances to be provided when they rent, and you can be pretty confident that expectation will rise the higher your price point is.
So, when you’re looking at which appliances to install, think about what renters expect, not just what you have to provide by law.
Lastly, you should keep quality in mind. You’re more likely to attract and retain tenants with better-quality appliances. Reliable appliances are also less likely to break, reducing your repair costs and the chances of serious risks like fires.
Are appliances tax deductible for rental properties?
The short answer is yes, but as with all tax deductions there are rules around what you can deduct. As a property investor, knowing which furniture and appliances qualify for tax deductions can significantly boost your rental returns.
First, you need to be genuinely offering the house for rent in a condition and location to attract tenants. Advertising your holiday home for rent but never actually letting anyone rent it isn’t allowed.
Then, if the expenses are for the purpose of renting out your property, you may be able to claim them as tax deductions. Since 2017, however, any appliances must be new.
For low-cost appliances (<$300), you can claim the full cost in the year of purchase. Make sure you keep receipts, statements, and installation records.
For higher-cost appliances, you can class them as low-value pooling or depreciating assets and claim back the depreciation over several years. You may therefore prefer to purchase lower-value items separately rather than in bulk.
Can you write off furniture for rental property?
Yes, you can write off furniture too. Items such as beds, tables, and wardrobes are depreciating assets rather than capital works. Like appliances, if they cost $300 or less, they can be immediately deducted, while more expensive items must be depreciated over their effective life (usually 10 years).
Proper record-keeping is essential, so make sure you keep invoices, receipts, and depreciation schedules. Where landlords go wrong, it’s where they try to deduct second-hand furniture, misclassify furniture as repairs, or apply the wrong depreciation method.
How do you depreciate appliances for rental properties?
More expensive items are classified as low-value pooling if they cost up to $1,001, or capital works if more. For low-value pooling, you can claim a deduction of 18.75% of the value in the first year, and 37.5% each year thereafter.
Depreciating assets are different depending on whether they are permanent or freestanding. For permanent fixtures, such as structural elements, built-in cupboards and kitchen cabinetry, the standard depreciation is 2.5% per year over 40 years.
Freestanding appliances can be written off more quickly, depending on the ATO’s estimated lifespan. You can either deduct an equal portion of the purchase price or a fixed percentage of the remaining value each year. Whichever schedule you choose, keep clear records. For example, built-in ovens and dishwashers are considered "plant and equipment" (Division 40) items, not capital works, even though they're fixed. Plant and equipment items depreciate according to their effective life as determined by the ATO, not at the 2.5% capital works rate.
Looking to maximise your deductions? Consider timing purchases before 30 June, to claim part of the depreciation in that tax year, rather than waiting another year. Avoiding second-hand assets and replacing old appliances when you buy a used property can also maximise your deductions.
Remember too that, if you repair or replace an appliance like-for-like, the cost may be fully deductible as a repair expense rather than a depreciating asset. This won’t apply if you replace it with a superior, upgraded model.
Lastly, consider hiring a quantity surveyor to prepare a depreciation schedule to maximise your claims on all eligible assets. The cost of the schedule itself is also tax-deductible.
Understanding your responsibilities for appliances in a rental property is essential for both compliance and tenant satisfaction. By staying informed about regulations, maintaining appliances, and strategically managing tax deductions, you can protect your investment while providing a well-equipped and desirable rental.
