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INCOME TAX ASSESSMENT ACT 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-10 - CAPITAL ALLOWANCES: RULES ABOUT DEDUCTIBILITY OF CAPITAL EXPENDITURE  

Division 43 - Deductions for capital works  

Subdivision 43-B - Establishing the deduction base  

Operative provisions

SECTION 43-70  What is construction expenditure?  

43-70(1)  

 [No equivalent]
Construction expenditure is capital expenditure incurred in respect of the construction of capital works.

43-70(2)  

 ITAA 36
Construction expenditure does not include:


(a) expenditure on acquiring land; or


(b) expenditure on demolishing existing structures; or


(c) expenditure on clearing, levelling, filling, draining or otherwise preparing the construction site prior to carrying out excavation works; or


(d) expenditure on landscaping; or


(e) expenditure on *plant; or


(f) expenditure on property for which a deduction is allowable, or would be allowable if the property were for use for the *purpose of producing assessable income, under:

(i) Subdivision 40-F (about primary production depreciating assets), Subdivision 40-G (about capital expenditure of primary producers and other landholders), Subdivision 40-H (about capital expenditure that is immediately deductible) or Subdivision 40-I (about capital expenditure that is deductible over time); or

(ii) the former Division 330 of this Act or the former Division 10, 10AAA or 10AA of Part III of the Income Tax Assessment Act 1936 (all of which dealt with mining and/or quarrying); or

(iii) section 73A of the Income Tax Assessment Act 1936 (about expenditure on scientific research); or

(iv) the former Subdivision 387-A of this Act or the former section 75D of the Income Tax Assessment Act 1936 (both of which allowed deductions for capital expenditure to prevent land degradation); or

(v) the former Subdivision 387-B of this Act or the former section 75B of the Income Tax Assessment Act 1936 (both of which allowed deductions for capital expenditure on facilities to conserve or convey water); or

(vi) the former Subdivision 387-G of this Act or the former section 124F or 124JA of the Income Tax Assessment Act 1936 (all of which allowed deductions for capital expenditure on forestry roads and/or timber mill buildings); or
 View history reference


(fa) any of these kinds of expenditure if a deduction is allowable for the expenditure, or would be allowable if property had been used for the purpose of producing assessable income:

(i) *mining capital expenditure or *transport capital expenditure;

(ii) expenditure on a *forestry road in connection with carrying on a *timber operation for a *taxable purpose;

(iii) expenditure for the construction or acquisition of a *timber mill building;

(iv) expenditure on a *depreciating asset you can deduct under subsection 40-80(1) (about exploration and prospecting); or
 View history reference


(g) expenditure on property for which a deduction under section 355-305 or 355-520 is allowable for the property, or would be allowable if the property were for use for conducting *R&D activities; or
 View history reference


(h) eligible heritage conservation expenditure within the meaning of the former Subdivision AAD of Division 17 of Part III of the Income Tax Assessment Act 1936; or
 View history reference


(i) expenditure that you cannot deduct because of section 26-100 (about water infrastructure improvement expenditure).
 View history reference

History

S 43-70(2) amended by No 96 of 2014, s 3 and Sch 5 item 23, by omitting "or (1A)" after "subsection 40-80(1)" from para (fa)(iv), effective 30 September 2014.

S 43-70(2) amended by No 88 of 2013, s 3 and Sch 3 item 7, by inserting para (i), applicable in relation to payments made on or after 1 April 2010 by the Commonwealth under a SRWUIP program.

S 43-70(2) amended by No 84 of 2013, s 3 and Sch 3 item 24, by inserting "or (1A)" in para (fa)(iv), effective 28 June 2013.

S 43-70(2) amended by No 93 of 2011, s 3 and Sch 3 items 27 and 28, by substituting para (g) and repealing the note at the end, effective 8 September 2011. For application, savings and transitional provisions see note under Div 355 heading. Para (g) and the note formerly read:


(g) expenditure on property for which a deduction is allowable, or would be allowable if the property were for use for carrying on *research and development activities, under section 73B, 73BA or 73BH of the Income Tax Assessment Act 1936, or would be allowable under that section of that Act if a company had not chosen a tax offset under section 73I of that Act; or

Note:

Paragraph (2)(g) only affects buildings begun before 21 November 1987, that were acquired or constructed under contracts entered into before that date or that were intended before that date to be used exclusively for research and development activities.

S 43-70(2) amended by No 101 of 2006, s 3 and Sch 2 items 666 to 674, by amending references to repealed inoperative provisions, effective 14 September 2006. For application and savings provisions see the CCH Australian Income Tax Legislation archive.

S 43-70(2) amended by No 170 of 2001, No 77 of 2001, No 121 of 1997.


 



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