FL107 is a valid FL. In some circumstances FL105 and the like will be allocated as cruising levels. Whether the controller will get any benefit from a more accurate level report is doubtful though, although given the performance of some modern aircraft sometimes the mode C can be a bit misleading and a pilot report is more accurate.
If you'll permit me to advocte some non-standard phraseology, I would suggest in your example a report of "just past FL105" or "approaching FL110" might be easier for the controller to assimilate than FL107.