What counts as rental income for tax purposes

[Adam Aust]

I’m preparing to buy my first rental property soon. My question is about the taxable portion of the rental income, specifically, money that is set aside for repairs, vacancy and capX. Is that money considered as income when it comes tax time?

I know there are lots of deductions that minimize/erase the tax burden, I’m just not sure if money sitting in an account for the above expenses is also taxable.

Thanks

[Brad Hammond]

Hey @Adam Aust.  Good question but any income that has not been spent on the categories you described would be considered taxable.  The income is taxed until it is spent on maintaining the property.