INCOME TAX ASSESSMENT ACT 1997
|CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION
|PART 2-10 - CAPITAL ALLOWANCES: RULES ABOUT DEDUCTIBILITY OF CAPITAL EXPENDITURE
Div 40 substituted for Divs 40, 41 and 42 by No 76 of 2001.
Subdiv 40-D inserted by No 76 of 2001.
In addition to section 40-290, you must reduce the amount (the balancing adjustment amount) included in your assessable income, or that you can deduct, under section 40-285 for a *depreciating asset if your deductions for the asset have been reduced under section 40-27.
The reduction is the following, as increased under subsection (3) if applicable:
| ||Sum of section 40-27 reductions|
|×||Balancing adjustment amount|| |
sum of section 40-27 reductions is the sum of:
(a) the reductions in your deductions for the asset under section 40-27; and
(b) if there has been roll-over relief for the asset under section 40-340 - the reductions in deductions for the asset for the transferor or an earlier successive transferor under section 40-27; and
(c) if you *hold the asset as the *legal personal representative of an individual - the reductions in deductions for the asset for the individual under section 40-27.
total decline is the sum of:
(a) the decline in value of the *depreciating asset since you started to *hold it; and
(b) if there has been roll-over relief for the asset under section 40-340 - the decline in value of the asset for the transferor or an earlier successive transferor; and
(c) if you hold the asset as the *legal personal representative of an individual - the decline in value of the asset for the individual.
(a) the *cost (for you) of the asset (the current asset) was worked out under section 40-205 (Cost of a split depreciating asset) or 40-210 (Cost of merged depreciating assets); and
(b) you used the *depreciating asset from which the current asset was split, or a depreciating asset that was merged into the current asset, or had it *installed ready for use, for the purpose to which paragraphs 40-27(2)(a) and (b) relate;
the reduction includes an increase equal to such amount as is reasonable having regard to the extent of the use referred to in paragraph (b) of this subsection.
S 40-291 inserted by No 126 of 2017, s 3 and Sch 2 item 5, effective 1 January 2018. For application provisions, see note under s 40-27.