(a) paragraph 721-25(1)(a) of the Income Tax Assessment Act 1997 applies to the agreement; and

the agreement was in force just before the commencement of this section.

the liability remained unpaid at that time; and

so much of the charge under the old provision as remained unpaid at that time had been imposed under the new provision and remained unpaid at that time.

in the 1997-98 income year or a later income year you dispose of a car that was leased to you or your associate; and

the lessor acquired the car in the 1996-97 income year or an earlier income year;

the cost of the car to the lessor for the purposes of Income Tax Assessment Act 1997 is worked out under the depreciation provisions of the Income Tax Assessment Act 1936.section 20-120 of the

(a) you have deducted or can deduct amounts for plant under Income Tax Assessment Act 1997 (the former Act) as in force just before it was amended by the New Business Tax System (Capital Allowances) Act 2001 and the New Business Tax System (Capital Allowances—Transitional and Consequential) Act 2001, or you could have deducted amounts under that Division for the plant if you had used it, or had it installed ready for use, for the purpose of producing assessable income before that day; andDivision 42 of the

either:

you hold the plant at 1 July 2001; or

subparagraph (i) does not apply and you were the owner or quasi-owner of the plant at the end of 30 June 2001.

the amount that was your undeducted cost at the end of 30 June 2001 becomes the plant’s opening adjustable value; and

you use the same cost, effective life and method that you were using under 30 June 2001; andDivision 42 of the former Act, or that you would have used if you had used the plant for the purpose of producing assessable income at the end of

if you excluded an amount from your assessable income under 21 September 1999—the cost of the plant, and its opening adjustable value, are reduced by that amount; andsection 42-290 of the former Act for a balancing adjustment event that occurred on or before 11.45 am, by legal time in the Australian Capital Territory, on

if subparagraph (1)(b)(ii) applies to you—you are treated as the holder of the plant while you are its holder or while the circumstances under which you would have been the owner or quasi-owner of the plant under the former Act continue.

for the diminishing value method—replace the component in the formula in subsection 40-70(1) of the new Act that includes the plant’s effective life with the rate you were using; and

for the prime cost method:

replace the component in the formula in subsection 40-75(1) of the new Act that includes the plant’s effective life with the rate you were using; and

increase the plant’s cost under 30 June 2001.Division 42 of the former Act by any amounts included in the second element of the plant’s cost after

you entered into a contract to acquire an item of plant before 1 July 2001 and you acquired it after 30 June 2001; or

you started to construct an item of plant before 1 July 2001 and you complete its construction after 30 June 2001.

you entered into a contract to acquire the plant, you otherwise acquired it or you started to construct it before 11.45 am, by legal time in the Australian Capital Territory, on 21 September 1999; and

you held it at the end of 30 June 2001; and

on or after 1 July 2001:

the plant is split into 2 or more depreciating assets; or

the plant is merged into another depreciating asset.

you have deducted or can deduct an amount for an IRU under 1 July 2001; andDivision 44 of the former Act or you would have been able to deduct an amount for it under that Division if you had used it for the purpose of producing assessable income before

you hold the IRU at 1 July 2001.

you use the cost, effective life and method you were using under 1 July 2001; andDivision 44 of the former Act or that you would have used if you had used the IRU for the purpose of producing assessable income before

the amount that was your undeducted cost of the IRU at the end of 30 June 2001 becomes the IRU’s opening adjustable value.

its cost is the amount of expenditure you incurred on the unit; and

you must use the prime cost method; and

its opening adjustable value at 1 July 2001 is its undeducted cost at the end of 30 June 2001; and

you must use the same effective life you were using under Subdivision 46-B of the former Act or that you would have used if you had used the software for the purpose of producing assessable income before 1 July 2001.

its cost is your expenditure incurred in obtaining the licence; and

its opening adjustable value at 1 July 2001 is the amount of unrecouped expenditure for the licence at the end of 30 June 2001; and

its effective life is the same as it had under the former Act; and

you must use the prime cost method.

its cost is your expenditure incurred in obtaining the licence; and

its opening adjustable value at 1 July 2001 is its cost; and

its effective life is 15 years less any period that has elapsed from the day the licence was issued until 1 July 2001; and

you must use the prime cost method.

it has an opening adjustable value at 1 July 2001 equal to the amount of unrecouped expenditure reduced by any deductions allowable under section 330-80 of the former Act for your income year ending on 30 June 2001; and

it has a cost equal to the total amount of allowable capital expenditure under the former Act; and

in applying the formula in 1 July 2001 occurs—you use the adjustments in subsection 40-75(3) of the new Act; andsection 40-75 of the new Act for the income year in which

it is taken to have been used for a taxable purpose at the start of 1 July 2001; and

it has a remaining effective life worked out under subsection (3); and

you must use the prime cost method.

for an amount of unrecouped expenditure in respect of expenditure incurred in carrying on eligible mining operations other than in the course of petroleum mining is the lesser of these:

the number equal to the difference between 10 and the number of income years (which may be zero) before the present income year for which an amount in respect of expenditure was deductible;

the number equal to the number of whole years in the estimated life of the mine, or proposed mine, on the mining property, or, if there is more than one such mine, of the mine that has the longest estimated life, as at the end of the present income year; or

for an amount of unrecouped expenditure in respect of expenditure incurred in carrying on eligible mining operations in the course of petroleum mining is the lesser of these:

the number equal to the difference between 10 and the number of income years (which may be zero) before the present income year for which an amount in respect of expenditure was deductible;

the number equal to the number of whole years in the estimated life of the petroleum field or proposed petroleum field as at the end of the present income year; or

for an amount of unrecouped expenditure in respect of expenditure incurred in carrying on eligible quarrying operations the lesser of these:

the number equal to the difference between 20 and the number of income years (which may be zero) before the present income year for which an amount in respect of expenditure was deductible; and

the number equal to the number of whole years in the estimated life of the quarry, or proposed quarry, on the quarrying property, or, if there is more than one such quarry, of the quarry that has the longest estimated life, as at the end of the present income year.

both of these subparagraphs apply:

(i) any of the unrecouped expenditure referred to in subsection (1) relates to a depreciating asset (the real asset);

(ii) in an income year (the cessation year) you stop holding the real asset, or stop using it for a taxable purpose; or

both of these subparagraphs apply:

(i) any of the unrecouped expenditure referred to in subsection (1) relates to property that is not a depreciating asset (the other property);

in the cessation year, the other property is disposed of, lost or destroyed, or you stop using it for a taxable purpose;

there is an additional decline in value of the notional asset for the cessation year equal to so much of the notional asset’s adjustable value as relates to the real asset or the other property and has not been taken into account in working out the amount of a balancing adjustment in relation to the real asset.

if the other property is sold for a price specific to that property—that price, less the expenses of the sale (to the extent the expenses are reasonably attributable to selling that particular property); or

if the other property is sold with additional property without a specific price being allocated to it—the part of the total sale price, less the reasonably attributable expenses of the sale, that is reasonably attributable to selling the other property; or

if the other property is lost or destroyed—the amount or value received or receivable under an insurance policy or otherwise for the loss or destruction; or

if you own the other property and you stop using it for a taxable purpose—its market value at that time; or

if you do not own the property and you stop using it for a taxable purpose—a reasonable amount.

However, the amount included is reduced to the extent (if any) that it is also included under subsection 40-830(6) of the new Act.

if the real asset is split into 2 or more depreciating assets and you stop holding, or stop using for a taxable purpose, one or more but not all of the assets into which it is split—subsection (5) does not apply to that asset or assets into which it is split that you continue to hold and continue to use for a taxable purpose; or

if the real asset is merged into another depreciating asset—section 40-125 does not apply to the asset into which it is merged while you continue to hold it.

you did not have an amount of unrecouped expenditure under 30 June 2001, but you had an amount of unrecouped expenditure under that Division before 30 June 2001; andDivision 330 of the former Act at the end of

(b) that expenditure relates to property that is not a depreciating asset (the other property); and

after that day, the other property is disposed of, lost or destroyed, or you stop using it for a taxable purpose.

you incur expenditure after 30 June 2001 under a contract entered into before that day; and

the expenditure would have been allowable capital expenditure, and you could have deducted an amount for it, under 1 July 2001; andDivision 330 of the former Act if you had incurred it before

the expenditure does not relate to a depreciating asset.

it has a cost at the time you incur the expenditure equal to the amount of the expenditure; and

in applying the formula in section 40-75 of the new Act for the income year in which you incur the expenditure—you use the adjustments in subsection 40-75(3) of the new Act; and

it is taken to be used for a taxable purpose when you incur the expenditure; and

it has an effective life worked out under subsection (3); and

you must use the prime cost method.

for an amount of expenditure incurred in carrying on eligible mining operations other than in the course of petroleum mining—the lesser of 10 and the number equal to the number of whole years in the estimated life of the mine, or proposed mine, on the mining property, or, if there is more than one such mine, of the mine that has the longest estimated life, as at the end of the present income year; or

for an amount of expenditure incurred in carrying on eligible mining operations in the course of petroleum mining—the lesser of 10 and the number equal to the number of whole years in the estimated life of the petroleum field or proposed petroleum field as at the end of the present income year; or

for an amount of expenditure incurred in carrying on eligible quarrying operations—the lesser of 20 and the number equal to the number of whole years in the estimated life of the quarry, or proposed quarry, on the quarrying property, or, if there is more than one such quarry, of the quarry that has the longest estimated life, as at the end of the present income year.

(a) any of the expenditure referred to in subsection (1) relates to property that is not a depreciating asset (the other property);

(b) in an income year (the cessation year), the other property is disposed of, lost or destroyed, or you stop using it for a taxable purpose;

there is an additional decline in value of the notional asset for the cessation year equal to so much of the notional asset’s adjustable value as relates to the other property.

if the other property is sold for a price specific to that property—that price, less the expenses of the sale (to the extent the expenses are reasonably attributable to selling that particular property); or

if the other property is sold with additional property without a specific price being allocated to it—the part of the total sale price, less the reasonably attributable expenses of the sale, that is reasonably attributable to selling the other property; or

if the other property is lost or destroyed—the amount or value received or receivable under an insurance policy or otherwise for the loss or destruction; or

if you own the other property and you stop using it for a taxable purpose—its market value at that time; or

if you do not own the property and you stop using it for a taxable purpose—a reasonable amount.

However, the amount included is reduced to the extent (if any) that it is also included under subsection 40-830(6) of the new Act.

the expenditure would have been a mining cash bidding payment under Subdivision 330-D of the former Act; and

either:

(i) you incurred the expenditure before that day but the grant of the mining authority concerned occurred on a day (the start day) after 30 June 2001; or

(ii) the grant of the mining authority concerned occurred before 30 June 2001 but you incurred the expenditure on a day (also the start day) after 30 June 2001.

it has a cost at the start day equal to the amount of the expenditure; and

in applying the formula in section 40-75 of the new Act for the income year in which the start day occurs—you use the adjustments in subsection 40-75(3) of the new Act; and

it is taken to be used for a taxable purpose on the start day; and

it has an effective life worked out under subsection (3); and

you must use the prime cost method.

for an amount of expenditure incurred in carrying on eligible mining operations other than in the course of petroleum mining—the lesser of 10 and the number equal to the number of whole years in the estimated life of the mine, or proposed mine, on the mining property, or, if there is more than one such mine, of the mine that has the longest estimated life, as at the end of the present income year; or

for an amount of expenditure incurred in carrying on eligible mining operations in the course of petroleum mining—the lesser of 10 and the number equal to the number of whole years in the estimated life of the petroleum field or proposed petroleum field as at the end of the present income year.

(a) any of the expenditure referred to in subsection (1) relates to a depreciating asset (the real asset);

(b) in an income year (the cessation year) you stop holding the real asset, or stop using it for a taxable purpose;

there is an additional decline in value of the notional asset for the cessation year equal to so much of the notional asset’s adjustable value as relates to the real asset and has not been taken into account in working out the amount of a balancing adjustment in relation to the real asset.

if the real asset is split into 2 or more depreciating assets and you stop holding, or stop using for a taxable purpose, one or more but not all of the assets into which it is split—subsection (5) does not apply to that asset or assets into which it is split that you continue to hold and continue to use for a taxable purpose; or

if the real asset is merged into another depreciating asset—section 40-125 does not apply to the asset into which it is merged while you continue to hold it.

it has an opening adjustable value at 1 July 2001 equal to the total amount of transport capital expenditure under the former Act less the amounts you have deducted or can deduct for that expenditure under the former Act; and

it has a cost equal to the total amount of transport capital expenditure under the former Act; and

in applying the formula in 1 July 2001 occurs—you use the adjustments in subsection 40-75(3) of the new Act; andsection 40-75 of the new Act for your income year in which

it is taken to have been used for a taxable purpose at the start of 1 July 2001; and

it has an effective life at the start of 1 July 2001 equal to the years remaining for the expenditure under section 330-395 of the former Act; and

you must use the prime cost method.

both of these subparagraphs apply:

(i) any of the transport capital expenditure referred to in subsection (1) relates to a depreciating asset (the real asset);

(ii) in an income year (the cessation year) you stop holding the real asset, or stop using it for a taxable purpose; or

both of these subparagraphs apply:

(i) any of the transport capital expenditure referred to in subsection (1) relates to property that is not a depreciating asset (the other property);

in the cessation year, the other property is disposed of, lost or destroyed, or you stop using it for a taxable purpose;

there is an additional decline in value of the notional asset for the cessation year equal to so much of the notional asset’s adjustable value as relates to the real asset or the other property and has not been taken into account in working out the amount of a balancing adjustment in relation to the real asset.

if the other property is sold for a price specific to that property—that price, less the expenses of the sale (to the extent the expenses are reasonably attributable to selling that particular property); or

if the other property is sold with additional property without a specific price being allocated to it—the part of the total sale price, less the reasonably attributable expenses of the sale, that is reasonably attributable to selling the other property; or

if the other property is lost or destroyed—the amount or value received or receivable under an insurance policy or otherwise for the loss or destruction; or

if you own the other property and you stop using it for a taxable purpose—its market value at that time; or

if you do not own the property and you stop using it for a taxable purpose—a reasonable amount.

However, the amount included is reduced to the extent (if any) that it is also included under subsection 40-830(6) of the new Act.

if the real asset is split into 2 or more depreciating assets and you stop holding, or stop using for a taxable purpose, one or more but not all of the assets into which it is split—subsection (4) does not apply to that asset or assets into which it is split that you continue to hold and continue to use for a taxable purpose; or

if the real asset is merged into another depreciating asset—section 40-125 does not apply to the asset into which it is merged while you continue to hold it.

you incur expenditure after 30 June 2001 under a contract entered into before that day; and

the expenditure would have been transport capital expenditure in respect of a transport facility, and you could have deducted an amount for it, under Subdivision 330-H of the former Act if you had incurred it before 1 July 2001 and you had started to use the facility for a qualifying purpose before 1 July 2001; and

the expenditure does not relate to a depreciating asset.

it has a cost at the time you incur the expenditure equal to the amount of the expenditure; and

in applying the formula in section 40-75 of the new Act for your income year in which you incur the expenditure—you use the adjustments in subsection 40-75(3) of the new Act; and

it is taken to have been used for a taxable purpose when you incur the expenditure; and

it has an effective life when you incur the expenditure equal to the years remaining for the expenditure under section 330-395 of the former Act; and

you must use the prime cost method.

(a) any of the expenditure referred to in subsection (1) relates to property that is not a depreciating asset (the other property);

(b) in an income year (the cessation year), the other property is disposed of, lost or destroyed, or you stop using it for a taxable purpose;

there is an additional decline in value of the notional asset for the cessation year equal to so much of the notional asset’s adjustable value as relates to the other property.

if the other property is sold for a price specific to that property—that price, less the expenses of the sale (to the extent the expenses are reasonably attributable to selling that particular property); or

if the other property is sold with additional property without a specific price being allocated to it—the part of the total sale price, less the reasonably attributable expenses of the sale, that is reasonably attributable to selling the other property; or

if the other property is lost or destroyed—the amount or value received or receivable under an insurance policy or otherwise for the loss or destruction; or

if you own the other property and you stop using it for a taxable purpose—its market value at that time; or

if you do not own the property and you stop using it for a taxable purpose—a reasonable amount.

However, the amount included is reduced to the extent (if any) that it is also included under subsection 40-830(6) of the new Act.

apart from this section, subsection 40-35(5), 40-38(5) or 40-40(4) would apply because the real asset referred to in that subsection is disposed of; and

(b) roll-over relief is chosen under subsection 40-340(3) of the Income Tax Assessment Act 1997 for the disposal.

the adjustable value of that real asset; and

the adjustable value of the notional asset referred to in subsection 40-35(5), 40-38(5) or 40-40(4);

just before the disposal.

at the end of 30 June 2001, you hold an item of intellectual property referred to in the table in section 373-35 of the former Act; and

you have deducted or can deduct an amount for expenditure on the asset under Division 373 of the former Act or you could have deducted an amount under that Division for that expenditure if you had used the asset for the purpose of producing assessable income on or before that day.

it has an opening adjustable value at 1 July 2001 equal to its unrecouped expenditure under the former Act at the end of 30 June 2001; and

its cost is its original unrecouped expenditure under the former Act; and

its effective life is the same as it had under the former Act; and

you must use the prime cost method.

(a) you have deducted or can deduct an amount under Subdivision 387-G of the former Act for an amount (the qualifying amount) of expenditure on a forestry road or timber mill building or could have deducted an amount under that Subdivision if you had used the road or building for the purpose of producing assessable income; and

you hold the road or building at the end of 30 June 2001.

it has an opening adjustable value at 1 July 2001 equal to the qualifying amount less any amounts you have deducted or can deduct for it under the former Act; and

in applying the formula in 1 July 2001 occurs—you use the adjustments in subsection 40-75(3) of the new Act; andsection 40-75 of the new Act for your income year in which

its cost is the qualifying amount; and

it has an effective life equal to the remaining life you last estimated for it under the former Act; and

you can recalculate its effective life if you conclude that your estimate is no longer accurate (except that the effective life cannot exceed 25 years); and

you must use the prime cost method.

(a) it has an opening adjustable value at 1 July 2001 equal to the qualifying amount less any amounts you have deducted or can deduct for it under the former Act or the Income Tax Assessment Act 1936; and

it has a cost equal to the qualifying amount; and

it has an effective life equal to the number of years for which you could deduct for the qualifying amount worked out under subsection 400-15(3) of the former Act; and

you must use the prime cost method.

its cost and opening adjustable value at 1 July 2001 is the closing balance of the pool for your income year in which 30 June 2001 occurred; and

you must use the diminishing value method; and

in applying the formula in 1 July 2001 occurs—it has a base value equal to that opening adjustable value; andsection 40-70 of the new Act for your income year in which

you replace the component in the formula in subsection 40-70(1) of the new Act that includes an asset’s effective life with the pool percentage you were using for the pool; and

if an item of plant is removed from the pool because a balancing adjustment event occurs for the item or because of subsection (3) of this section, section 40-115 of the new Act applies so that you are treated as having split the single depreciating asset into the removed asset and the remaining assets in the pool; and

if an amount is included in the second element of the cost of a depreciating asset in the pool, Division 40 of the new Act applies as if that amount had been included in the second element of the cost of the single asset.

has a substituted accounting period; and

because of a provision of this Subdivision, uses Division 40 of the new Act to work out the decline in value of an asset, or of something that is treated as an asset.

the entity works out its deductions for that asset under the former Act as from the start of its calculation year up to the end of 30 June 2001 as if that period were an income year; and

the entity works out the decline in value of the asset under 1 July 2001 until the end of its calculation year as if that period were an income year in accordance with the following provisions of this section.Division 40 of the new Act from

for a unit of plant (including IRUs and expenditure on software that is not pooled)—its undeducted cost at the end of 30 June 2001; or

for expenditure on eligible mining or quarrying operations, an item of intellectual property or a spectrum licence—the amount of unrecouped expenditure for the expenditure, item or licence under the former Act at the end of 30 June 2001 reduced, in the case of eligible mining or quarrying operations, by an amount you have deducted or can deduct for the calculation year under the former Act and not yet taken into account in calculating unrecouped expenditure; or

for transport capital expenditure—the entity’s amount of transport capital expenditure under the former Act at the end of 30 June 2001 less any amounts the entity has deducted or can deduct for it under the former Act up to that time; or

for expenditure on a forestry road, a timber mill building, a horticultural plant or a grapevine—the amount of that expenditure less any amounts the entity has deducted or can deduct for it under the former Act up to 30 June 2001; or

for expenditure on evaluating the impact on the environment of a project—the amount of that expenditure less any amounts the entity has deducted or can deduct for it under the former Act up to 30 June 2001; or

for assets that were pooled under Subdivision 42-M or 42-L of the former Act—the closing balance of the pool at the end of 30 June 2001.

for an item of plant for which you were using the prime cost method—using the rules in section 40-10 of this Act; and

for an IRU for which you were using the prime cost method—using the rules in section 40-20 of this Act; and

for a unit of software for which the entity was deducting amounts under Subdivision 46-B of the former Act—using the rules in subsection 40-25(2) of this Act; and

for a spectrum licence—using the rules in section 40-30 of this Act; and

for an item of intellectual property—using the rules in section 40-45 of this Act; and

for an amount of expenditure on evaluating the impact on the environment of a project—using the rules in section 40-55 of this Act.

for an amount of unrecouped expenditure under Division 330 of the former Act—using the rules in section 40-35 of this Act; and

for an amount of transport capital expenditure under Division 330 of the former Act—using the rules in section 40-40 of this Act; and

for a forestry road or timber mill building—using the rules in section 40-50 of this Act.

allowable capital expenditure for which the entity had deducted or can deduct an amount under Subdivision 330-C of the former Act; or

transport capital expenditure for which the entity had deducted or can deduct an amount under Subdivision 330-H of the former Act; or

a water facility for which the entity had deducted or can deduct an amount under Subdivision 387-B of the former Act; or

expenditure on connecting power to land or upgrading the connection for which the entity had deducted or can deduct an amount under Subdivision 387-E of the former Act; or

expenditure on a telephone line on or extending to land for which the entity had deducted or can deduct an amount under Subdivision 387-E of the former Act;

reduce its deductions for each of the periods referred to in paragraphs (2)(a) and (b) by multiplying the deduction for that period by the number of days in that period and dividing the result by 365.

(a) you have deducted one or more amounts under former Income Tax Assessment Act 1936 for an asset;section 73BA of the

you could have deducted one or more amounts under that former section for the asset if you had not chosen tax offsets under former section 73I of that Act.

(a) paragraph 40-65(6)(a) of the Income Tax Assessment Act 1997 included both events set out in subsection (1) of this section; and

subsections 40-65(6) and (7) of that Act deal with all 4 kinds of events in a corresponding way to the way that they deal with 2 kinds of events.

(a) you are taken to start holding a depreciating asset on or after 10 May 2006 because of Income Tax Assessment Act 1997; andsection 40-115 (about splitting a depreciating asset) or 40-125 (about merging depreciating assets) of the

it is reasonable to conclude that you split the asset or merged the assets for the main purpose of ensuring that the decline in value of the asset or assets (after the splitting or merging) would be worked out under section 40-72 of that Act;

that Act applies to you as if you had started to hold the split or merged asset or assets before 10 May 2006.

you had actually started to hold it before that day; and

on or after 10 May 2006, you stop holding the depreciating asset; and

it is reasonable to conclude that you did this for the main purpose of ensuring that the decline in value of the asset would be worked out under section 40-72 of that Act.

you started to hold the substituted asset on or after that day under an arrangement; and

the substituted asset is identical to or has a purpose similar to another depreciating asset that another entity acquired from you on or after that day under that arrangement; and

you did not deal with the other entity at arm’s length; and

it is reasonable to conclude that you entered into the arrangement for the main purpose of ensuring that the decline in value of the substituted asset would be worked out under section 40-72 of that Act.

you hold a depreciating asset (except a mining, quarrying or prospecting right that you started to hold before 1 July 2001) that you:

started to hold under a contract entered into before 1 July 2001; or

constructed where the construction started before that day; or

started to hold in some other way before that day; and

your expenditure on the asset, whenever incurred, would have been allowable capital expenditure, transport capital expenditure or expenditure on exploration or prospecting within the meaning of 1 July 2001.Division 330 of the former Act if it had been incurred before

if the expenditure on the asset was incurred in relation to eligible mining operations other than in the course of petroleum mining—the shorter of:

10 years; and

the number of whole years in the estimated life of the mine or proposed mine to which the expenditure relates or, if there is more than one such mine, of the mine that has the longest estimated life; or

if the expenditure on the asset was incurred in relation to eligible mining operations in the course of petroleum mining—the shorter of:

10 years; and

the number of whole years in the estimated life of the petroleum field or proposed petroleum field to which the expenditure relates; or

if the expenditure on the asset was incurred in relation to eligible quarrying operations—the shorter of:

20 years; or

the number of whole years in the estimated life of the quarry or proposed quarry to which the expenditure relates or, if there is more than one such quarry, of the quarry that has the longest estimated life.

you started to hold another mining, quarrying or prospecting right before that day; and

the other right ends on or after that day; and

the new right and the other right relate to the same area, or any difference in area is not significant.

(a) a company (the original holder) started to hold the right before 1 July 2001; and

the right is transferred after that day to another company where:

the other company is a member of the same wholly-owned group as the original holder and was a member of that group just before that day; and

the right was held in the period between that day and the time of the transfer by a company or companies that were members of that group on that day and at the time of the transfer.

you acquired the interest under an interest realignment arrangement; and

the interest was acquired in exchange for one or more other interests in other mining, quarrying or prospecting rights all of which you had started to hold before 1 July 2001.

(a) you acquired, under an interest realignment arrangement, an interest (a new interest) in a mining, quarrying or prospecting right; and

(b) the interest was acquired in exchange for one or more other interests (old interests) in other mining, quarrying or prospecting rights; and

you started to hold some of the old interests before 1 July 2001;

1 July 2001.Division 40 of the new Act applies to the new interest only to the extent that the new interest was acquired in exchange for the old interests that you started to hold on or after

you dispose of a mining, quarrying or prospecting right that you started to hold before 1 July 2001 to an associate of yours (except a company that is a member of the same wholly-owned group); or

you enter into an arrangement in relation to such a right under which you maintain, in essence, the economic ownership of the right but not its legal ownership;

the cost of the right to the purchaser is limited, for the purposes of Division 40 of the new Act, to a maximum of the costs that would have been deductible for the right under Division 330 of the former Act.

you have not deducted and cannot deduct (either immediately or over time) under the former Act; and

did not form part of allowable capital expenditure under the former Act; and

did not entitle you to a deduction under section 330-235 of the former Act;

but only to the extent that you have not already applied the amount under this section.

after 1 July 2001, you stop holding a mining, quarrying or prospecting right that you started to hold before that day; and

you have deducted or can deduct an amount for it under Subdivision 330-C in relation to Subdivision 330-D or 330-E of the former Act.

The amount included is the amount you have deducted or can deduct.

after 1 July 2001, you stop holding a mining, quarrying or prospecting right that you started to hold before that day; and

because of section 40-35 or 40-38 of this Act, you have deducted or can deduct an amount for a notional asset that relates to expenditure on the right under Division 40 of the new Act.

The amount included is the amount you have deducted or can deduct.

you acquired the right from an associate (except a company that is a member of the same wholly-owned group) on or after 1 July 2001; and

the associate started to hold the right before that day.

you incur expenditure after 30 June 2001 that forms part of the cost of a depreciating asset; and

the depreciating asset is one that you:

started to hold under a contract entered into before 1 July 2001; or

constructed where the construction started before that day; or

started to hold in some other way before that day; and

if you had incurred the expenditure before 1 July 2001, and had satisfied any relevant requirement for deductibility, you would have been able to deduct an amount for it under Division 44, 373 or 380, or Subdivision 46-B or 387-G, of the former Act.

(a) a determination under Income Tax Assessment Act 1997 of the effective life of an asset;section 40-100 of the

a calculation under section 40-105 of that Act of the effective life of an asset;

if the instrument was in force immediately before the commencement of Schedule 1 to the Tax Laws Amendment (Research and Development) Act 2011.

the income year is the year in which you start to use the asset, or have it installed ready for use, for a taxable purpose; and

subsection (2) (about businesses with turnover less than $500 million) applies to you for the year and for the income year in which you started to hold the asset (if that was an earlier year); and

you are covered by section 40-125 for the asset; and

you have not made a choice under section 40-137 in relation to the income year.

Businesses with turnover less than $500 million

are a small business entity; or

would be a small business entity if:

(i) each reference in Subdivision 328-C of the Income Tax Assessment Act 1997 (about what is a small business entity) to $10 million were instead a reference to $500 million; and

the reference in paragraph 328-110(5)(b) of that Act to a small business entity were instead a reference to an entity covered by this subsection.

Exception—assets for which the decline in value is worked out under section 40-82 or Subdivision 40-E or 40-F of the Income Tax Assessment Act 1997

(a) Income Tax Assessment Act 1997;section 40-82 of the

(b) Subdivision 40-E or 40-F of that Act.

start to hold the asset; and

start to use it, or have it installed ready for use, for a taxable purpose.

Exception—commitments already entered into

entered into a contract under which you would hold the asset; or

started to construct the asset; or

started to hold the asset in some other way.

on a day before 12 March 2020, you:

enter into a contract under which you hold an asset on that day, or will hold the asset on a later day; or

start to construct an asset; or

start to hold an asset in some other way; and

(b) on a day on or after 12 March 2020 (the conduct day), you engage in conduct that results in you:

entering into a contract under which you hold the post-12 March 2020 asset on the conduct day, or will hold that asset on an even later day; or

starting to construct the post-12 March 2020 asset; or

starting to hold the post-12 March 2020 asset in some other way; and

the post-12 March 2020 asset is the asset mentioned in paragraph (a), or an identical or substantially similar asset; and

you engage in that conduct for the purpose, or for purposes that include the purpose, of becoming covered by this section for the post-12 March 2020 asset.

entering into a contract under which the partnership would hold the asset;

starting to construct the asset;

acquiring an option to enter into such a contract.

Exception—second hand assets

another entity held the asset when it was first used, or first installed ready for use, other than:

as trading stock; or

merely for the purposes of reasonable testing or trialling; or

(b) you started holding the asset under Income Tax Assessment Act 1997 (about splitting a depreciating asset) or section 40-125 of that Act (about merging depreciating assets); orsection 40-115 of the

you were already covered by this section for the asset as a member of a consolidated group or a MEC group of which you are no longer a member.

the asset is a licence (including a sub-licence) relating to an intangible asset; and

the exception in that subsection applies in relation to the intangible asset.

it is not reasonable to conclude that you will use the asset principally in Australia for the principal purpose of carrying on a business; or

it is reasonable to conclude that the asset will never be located in Australia.

if the asset’s start time occurs in the current year—the amount worked out under subsection (2); or

if the asset’s start time occurred in an earlier year—the amount worked out under subsection (4).

Current year is the year the asset starts to decline in value

50% of the asset’s cost as at the end of the current year, disregarding any amount included in the second element of the asset’s cost after 30 June 2021;

(b) the amount that would be the asset’s decline in value for the current year under Income Tax Assessment Act 1997, assuming its cost were reduced by the amount worked out under paragraph (a).Division 40 of the

50% of the sum of the asset’s opening adjustable value for the current year and any amount included in the second element of its cost for that year, disregarding any amount included in that second element after 30 June 2021;

(b) the amount that would be the asset’s decline in value for the current year under Income Tax Assessment Act 1997 assuming:Division 40 of the

for the diminishing value method—its base value were reduced by the amount worked out under paragraph (a); or

(ii) for the prime cost method—the component “Asset’s *cost” in the formula in subsection 40-75(1) of that Act (as adjusted under that section) were reduced by the amount worked out under paragraph (a).

for the diminishing value method—the asset’s base value for the year; or

for the prime cost method—the sum of its opening adjustable value for the income year and any amount included in the second element of its cost for that year.

you start to hold the asset; and

you start to use the asset, or have it installed ready for use, for a taxable purpose.

Exception—assets to which Division 40 does not apply

it is not reasonable to conclude that you will use the asset principally in Australia for the principal purpose of carrying on a business; or

it is reasonable to conclude that the asset will never be located in Australia.

Exception—assets for which the decline in value is worked out under Subdivision 40-E or 40-F of the Income Tax Assessment Act 1997

(a) the asset is allocated to a low-value pool, or expenditure on the asset is allocated to a software development pool (see Subdivision 40-E of the Income Tax Assessment Act 1997); or

(b) you or another taxpayer has deducted or can deduct amounts for the asset under Subdivision 40-F of the Income Tax Assessment Act 1997 (about primary production depreciating assets).

you are a corporate tax entity at any time in the income year; and

any of the following amounts is less than $5 billion:

the sum of your ordinary income (if any) and statutory income (if any) for the 2018-19 income year;

if the 2019-20 income year ends on or before 6 October 2020—the sum of your ordinary income (if any) and statutory income (if any) for the 2019-20 income year; and

the sum of the amounts worked out under subsection (3) for the 2016-17, 2017-18 and 2018-19 income years exceeds $100 million.

firstly, identify each depreciating asset (other than an intangible asset) that:

you hold at any time in the income year; and

you started to use, or have installed ready for use, for a taxable purpose in the income year;

next, work out the cost of each of those assets (including any amounts included in the second element of the asset’s cost at a time that is in the income year);

finally, work out the total of those costs.

it was not reasonable to conclude that you would use the asset principally in Australia for the principal purpose of carrying on a business; or

it was reasonable to conclude that the asset would never be located in Australia.

disregard section 40-45 of that Act and work out the cost of the capital works using Subdivision 40-C of that Act; and

disregard section 40-215 of that Act.

you start to hold the asset at or after the 2020 budget time; and

you start to use the asset, or have it installed ready for use, for a taxable purpose in the current year; and

you are covered by section 40-150 for the asset; and

you are covered for the current year by any of the following:

section 40-155 (about businesses with turnover under $5 billion);

section 40-157 (about corporate tax entities with income under $5 billion); and

no balancing adjustment event happens to the asset in the current year; and

you have not made a choice under section 40-190 in relation to the current year.

Exclusions

where section 40-155 covers you for the current year (regardless whether section 40-157 also covers you for the current year)—an exclusion applies to you and the asset for the current year under section 40-165 (about exclusions for businesses with turnover of $50 million or more); or

where section 40-157 covers you for the current year (but section 40-155 does not):

an exclusion applies to you and the asset for the current year under section 40-165; or

an exclusion applies to you and the asset for the current year under section 40-167 (about exclusions for corporate tax entities with income under $5 billion).

Amount of the decline in value

if the asset’s start time occurs in the current year—the asset’s cost as at the end of the current year, disregarding any amount included in the asset’s cost after 30 June 2023; or

if the asset’s start time occurred in an earlier year—the sum of its opening adjustable value for the current year and any amount included in the second element of its cost for the current year, disregarding any amount included in the asset’s cost after 30 June 2023.

where paragraph 40-160(2)(a) applies—section 40-155 would not cover you for the income year if the reference in that section to $5 billion were instead a reference to $50 million; and

any of the exclusions in this section applies in relation to the asset.

Exclusion—commitments already entered into

entered into a contract under which you would hold the asset; or

started to construct the asset; or

started to hold the asset in some other way.

on a day before 6 October 2020, you:

enter into a contract under which you hold an asset on that day, or will hold the asset on a later day; or

start to construct an asset; or

start to hold an asset in some other way; and

(b) on a day on or after 6 October 2020 (the conduct day), you engage in conduct that results in you:

entering into a contract under which you hold the post-6 October 2020 asset on the conduct day, or will hold that asset on an even later day; or

starting to construct the post-6 October 2020 asset; or

starting to hold the post-6 October 2020 asset in some other way; and

the post-6 October 2020 asset is the asset mentioned in paragraph (a), or an identical or substantially similar asset; and

you engage in that conduct for the purpose, or for purposes that include the purpose, of satisfying paragraph 40-160(1)(a) for the post-6 October 2020 asset.

entering into a contract under which the partnership would hold an asset;

starting to construct an asset;

acquiring an option to enter into such a contract.

Exclusion—second hand assets

another entity held the asset when it was first used, or first installed ready for use, other than:

as trading stock; or

merely for the purposes of reasonable testing or trialling; or

(b) you started holding the asset under Income Tax Assessment Act 1997 (about splitting a depreciating asset) or section 40-125 of that Act (about merging depreciating assets); orsection 40-115 of the

you already satisfied paragraph 40-160(1)(a) of this Act for the asset as a member of a consolidated group or a MEC group of which you are no longer a member.

the asset is a licence (including a sub-licence) relating to an intangible asset; and

the exclusion in that subsection applies in relation to the intangible asset.

an associate of yours;

an entity that is a foreign resident.

either:

you start to use the asset, or have it installed ready for use, for a taxable purpose in the current year; or

you started to use the asset, or have it installed ready for use, for a taxable purpose in an earlier income year; and

you are covered by section 40-150 for the asset; and

you are covered for the current year by any of the following:

section 40-155 (about businesses with turnover under $5 billion);

section 40-157 (about corporate tax entities with income under $5 billion); and

the eligible second element worked out under section 40-175 for the asset for the year is greater than nil; and

no balancing adjustment event happens to the asset in the current year; and

you have not made a choice under section 40-190 in relation to the current year.

Exclusions

section 40-157 covers you for the current year (but section 40-155 does not); and

an exclusion applies to you and the asset for the current year under section 40-167 (about exclusions for corporate tax entities with income under $5 billion).

Amount of the decline in value

(a) if the asset’s decline in value for the year would, apart from Income Tax Assessment Act 1997—the amount worked out under subsection (3); orsection 40-145, be worked out under section 40-82 of the

if the asset’s decline in value for the year would, apart from section 40-145, be worked out under Subdivision 40-BA of this Act—the amount worked out under subsection (4); or

otherwise—the amount worked out under subsection (5).

Assets affected by section 40-82 of the Income Tax Assessment Act 1997 (about assets costing less than $150,000, medium sized businesses)

(a) the amount that would be the asset’s decline in value for the year under Income Tax Assessment Act 1997, assuming the reference in subparagraph 40-82(3A)(b)(ii) of that Act to 31 December 2020 were instead a reference to the 2020 budget time; andsection 40-82 of the

the eligible second element worked out under section 40-175 of this Act for the asset for the year.

Assets affected by Subdivision 40-BA (backing business investment)

the amount that would be worked out under paragraph 40-130(2)(a) or (4)(a) (whichever is applicable) for the year, assuming the references in paragraphs 40-130(2)(a) and (4)(a) to 30 June 2021 were instead references to the 2020 budget time; and

the eligible second element worked out under section 40-175 for the asset for the year; and

the amount that would be worked out under paragraph 40-130(2)(b) or (4)(b) (whichever is applicable) for the year, assuming the references in paragraphs 40-130(2)(b) and (4)(b) to “the amount worked out under paragraph (a)” were instead references to “the amounts worked out under paragraphs 40-170(4)(a) and (b)”.

Other assets

(a) the amount that would be the asset’s decline in value for the year under Income Tax Assessment Act 1997, disregarding any amounts included in the eligible second element worked out under section 40-175 of this Act for the asset for the year; andDivision 40 of the

the eligible second element worked out under section 40-175 for the asset for the year.

either:

it becomes not reasonable to conclude that you will use the asset principally in Australia for the principal purpose of carrying on a business; or

it becomes reasonable to conclude that the asset will never be located in Australia; and

(b) none of the requirements in paragraphs 40-295(1)(a), (b) or (c) of the Income Tax Assessment Act 1997 are satisfied in relation to the asset.

Balancing adjustment event and termination value

the car depreciation limit under Division 42 of the former Act; and

(b) the motor vehicle depreciation limit under former Income Tax Assessment Act 1936.section 57AF of the

have a substituted accounting period; and

start to hold a car in your 2001-02 income year but before 1 July 2001;

you must use as the car limit the car depreciation limit under section 42-80 of the former Act for the 2000-01 financial year.

you are entitled to a deduction under subsection 40-285(2) of the new Act for a balancing adjustment event happening to a depreciating asset:

to which Division 58 of the former Act applied; or

(ii) to which former Income Tax Assessment Act 1936 applied, or for which the transition time under Division 57 in Schedule 2D to that Act occurred before 1 July 2001; andsection 61A of the

you would have been entitled to a further deduction under section 42-197 of the former Act.

the asset is either:

a depreciating asset that is not plant and that you started to hold under a contract entered into before 1 July 2001, you constructed where the construction started before that day or you started to hold in some other way before that day; or

plant that you acquired at or before 11.45 am, by legal time in the Australian Capital Territory, on 21 September 1999; and

any capital gain or capital loss would be disregarded (if Part 3-1 of the new Act applied):

because of section 118-5 (about cars, motor cycles and valour decorations); or

because of section 118-10 (about collectables); or

because of section 118-12 (about plant used to produce exempt income); or

because the asset was a pre-CGT asset at the time of the balancing adjustment event.

if the depreciating asset is plant—at or before 11.45 am, by legal time in the Australian Capital Territory, on 21 September 1999; or

if the depreciating asset is not plant—before 1 July 2001;

where:

the time of the event is when you entered into the contract for the disposal of the asset; and

the change in ownership constituting the disposal occurred after the applicable time mentioned in paragraph (a) or (b).

(a) on or after 1 July 2001, a company (the transferor) disposes of a depreciating asset to another company; and

the companies are members of the same linked group at the time of the disposal; and

apart from this section, the disposal would have resulted in:

(i) an amount (the included amount) being included in the assessable income of the transferor under subsection 40-285(1) of the Income Tax Assessment Act 1997; and

(ii) the transferor having an additional decline in value (the deductible amount) under subsection 40-35(5), 40-38(5) or 40-40(4) of this Act; and

the included amount is more than the deductible amount.

(a) on or after 1 July 2001, a company (the transferor) disposes of property that is not a depreciating asset to another company; and

the companies are members of the same linked group at the time of the disposal; and

(c) apart from this section, the disposal would have resulted in the transferor having an additional decline in value (the deductible amount) under subsection 40-35(5), 40-37(5), 40-40(4) or 40-43(4) of this Act; and

the sum of:

the money the transferor receives, or is entitled to receive, in respect of the disposal; and

the market value of any other property the transferor receives, or is entitled to receive, in respect of the disposal;

is more than the deductible amount.

(a) a balancing adjustment event happens in an income year (the event year) commencing on or after 1 July 2011 for an asset held by the R&D entity and:

(i) the R&D entity can deduct, for an income year, an amount under Income Tax Assessment Act 1997 (the new Act), as that section applies apart from Division 355 of that Act and former section 73BC of the Income Tax Assessment Act 1936 (the old Act); orsection 40-25 of the

the R&D entity could have deducted, for an income year, an amount as described in subparagraph (i) if it had used the asset; and

either or both of the following subparagraphs apply:

(i) the R&D entity can deduct (the old law deductions) under former section 73BA or 73BH of the old Act an amount for one or more income years for the asset;

(ii) the R&D entity chooses tax offsets under former old law deductions) under those former sections for one or more income years for the asset.section 73I of the old Act instead of deductions (also the

Section 40-290 to be applied as if use for carrying on R&D activities were use for a taxable purpose

the purpose of the carrying on, by or on behalf of the R&D entity, of the research and development activities (within the meaning of former section 73B of the old Act) to which the old law deductions relate; or

(b) if the R&D entity is entitled under new law deductions) under section 355-305 of that Act for the asset—the purpose of conducting the R&D activities to which the new law deductions relate.section 355-100 of the new Act to tax offsets for one or more income years for deductions (the

Increase in amounts deductible or assessable under section 40-285

that the R&D entity can deduct for the asset under section 40-285 of the new Act (after applying subsection (2) of this section) for the event year; or

that is included in the R&D entity’s assessable income for the asset under section 40-285 of the new Act (after applying subsection (2) of this section) for the event year;

is taken to be increased under section 40-292 of the new Act by the following amount:

where:

adjusted section 40-285 amount means:

if the section 40-285 amount is a deduction—the amount of the deduction; or

if the section 40-285 amount is an amount included in the R&D entity’s assessable income—so much of the section 40-285 amount as does not exceed the total decline in value.

old law 1.25 rate deductions means the sum of the R&D entity’s notional Division 40 deductions, and notional Division 42 deductions, (if any) for the asset that were multiplied by 1.25 in working out the old law deductions.

total decline in value means the cost of the asset less its adjustable value.

Application of Division 355

if the section 40-285 amount is an amount included in the R&D entity’s assessable income—a clawback amount under section 355-447 of the new Act for the income year; or

if the section 40-285 amount is a deduction—a catch up amount under section 355-466 of the new Act for the income year;

equal to the following amount:

where:

adjusted section 40-285 amount means:

if the section 40-285 amount is a deduction—the amount of the deduction; or

if the section 40-285 amount is an amount included in the R&D entity’s assessable income—so much of the section 40-285 amount as does not exceed the total decline in value.

total decline in value means the cost of the asset less its adjustable value.

Normal rules do not apply for the asset and the event

(a) Tax Laws Amendment (Research and Development) Act 2011);section 40-292 of the new Act (as amended by the

(b) Tax Laws Amendment (Research and Development) Act 2011);section 40-292 of the new Act (as that section applies because of Part 2 of Schedule 4 to the

to the extent that they would otherwise apply apart from this section to the R&D entity for the event, do so apply to the R&D entity for the event.

(a) a balancing adjustment event happens in an income year (the event year) commencing on or after 1 July 2011 for an asset held by the R&D partnership and:

(i) the R&D partnership can deduct, for an income year, an amount under Income Tax Assessment Act 1997 (the new Act), as that section applies apart from Division 355 of that Act and former section 73BC of the Income Tax Assessment Act 1936 (the old Act); orsection 40-25 of the

the R&D partnership could have deducted, for an income year, an amount as described in subparagraph (i) if it had used the asset; and

either or both of the following subparagraphs apply:

(i) one or more partners of the R&D partnership can deduct (the old law deductions) under former section 73BA or 73BH of the old Act amounts for one or more income years for the asset;

(ii) one or more partners of the R&D partnership choose tax offsets under former old law deductions) under those former sections for one or more income years for the asset.section 73I of the old Act instead of deductions (also the

Section 40-290 to be applied as if use for carrying on R&D activities were use for a taxable purpose

the purpose of the carrying on, by or on behalf of the R&D partnership, of the research and development activities (within the meaning of former section 73B of the old Act) to which the old law deductions relate; or

(b) if one or more partners of the R&D partnership are entitled under new law deductions) under section 355-520 of that Act for the asset—the purpose of conducting the R&D activities to which the new law deductions relate.section 355-100 of the new Act to tax offsets for one or more income years for deductions (the

Increase in amounts deductible or assessable under section 40-285

that the R&D partnership can deduct for the asset under section 40-285 of the new Act (after applying subsection (2) of this section) for the event year; or

that is included in the R&D partnership’s assessable income for the asset under section 40-285 of the new Act (after applying subsection (2) of this section) for the event year;

is taken to be increased under section 40-293 of the new Act by the following amount:

where:

adjusted section 40-285 amount means:

if the section 40-285 amount is a deduction—the amount of the deduction; or

if the section 40-285 amount is an amount included in the R&D partnership’s assessable income—so much of the section 40-285 amount as does not exceed the total decline in value.

old law 1.25 rate deductions means the sum of the partners’ notional Division 40 deductions, and notional Division 42 deductions, (if any) for the asset that were multiplied by 1.25 in working out the old law deductions.

total decline in value means the cost of the asset less its adjustable value.

Application of Division 355

if the section 40-285 amount is an amount included in the R&D partnership’s assessable income—a clawback amount under section 355-449 of the new Act for the income year; or

if the section 40-285 amount is a deduction—a catch up amount under section 355-468 of the new Act for the income year;

equal to the partner’s proportion of the following amount:

where:

adjusted section 40-285 amount means:

if the section 40-285 amount is a deduction—the amount of the deduction; or

if the section 40-285 amount is an amount included in the R&D partnership’s assessable income—so much of the section 40-285 amount as does not exceed the total decline in value.

sum of new law deductions means the sum of each partner’s new law deductions mentioned in paragraph (2)(b) of this section.

total decline in value means the cost of the asset less its adjustable value.

Normal rules do not apply for the asset and the event

you acquire it:

within 2 income years after the end of the income year in which the balancing adjustment event occurred; and

in your 2001-02 or 2002-2003 income year; and

at the end of the income year in which you acquired it, you used it, or had it installed ready for use, wholly for the purpose of producing assessable income; and

you can deduct an amount for its decline in value; and

you had not made a choice under section 42-285 or 42-293 of the former Act for the balancing adjustment event.

there is roll-over relief under section 40-340 of the new Act as a result of a balancing adjustment event happening to plant; and

the transferor referred to in that section was working out the decline in value of the plant under subsection 40-10(3) or 40-12(3) of this Act.

Plant acquired before 21 September 1999

the transferor started to hold the plant under a contract entered into at or before 11.45 am, by legal time in the Australian Capital Territory, on 21 September 1999; or

the transferor constructed it and the construction started at or before that time; or

the transferor acquired it in some other way at or before that time; or

the transferor acquired it from an entity that was working out the decline in value of the plant under subsection 40-10(3) or 40-12(3) of this Act and paragraph (a), (b) or (c) of this subsection applied to that entity or to the earliest successive transferor.

Small business taxpayers

the plant was not acquired as mentioned in subsection (2); and

the transferor, or an earlier successive transferor, was using a rate for the plant under subsection 42-160(1) or 42-165(1) of the former Act; and

the conditions set out in this table are satisfied:

for the diminishing value method—replacing the component in the formula in subsection 40-70(1) of the new Act that includes the plant’s effective life with the rate the transferor, or the earliest successive transferor, was using; or

for the prime cost method:

replacing the component in the formula in subsection 40-75(1) of the new Act that includes the plant’s effective life with the rate the transferor, or the earliest successive transferor, was using; and

increasing the plant’s cost under 30 June 2001.Division 42 of the former Act by any amounts included in the second element of the plant’s cost after

Meaning of small business taxpayer

the entity carries on a business in that year; and

the entity’s average turnover for that year is less than $1,000,000.

Meaning of average turnover

3; or

if the entity did not carry on a business in each of the current year and the 2 years before the current year, the number of those income years in which the entity carried on a business.

sum of relevant group turnovers is the sum of:

the entity’s group turnover for the current year; and

the entity’s group turnover (if any) for the 2 preceding income years.

Meaning of group turnover

the value of the business supplies the primary entity made in the income year; and

the value of the business supplies entities connected with the primary entity made in the income year;

reduced by:

that part of the value of the business supplies the primary entity made in the income year that is attributable to supplies it made during the year to entities connected with it when they were connected with it; and

that part of the value of the business supplies entities connected with the primary entity made in the income year that is attributable to supplies the connected entities made during the year to the primary entity when they were connected with it; and

that part of the value of the business supplies another entity made in the income year that is attributable to supplies the other entity made to a third entity at a time when both the other entity and third entity were connected with the primary entity.

Value of business supplies

for taxable supplies (if any) the entity makes during the year in the course of carrying on a business—the value (as defined by section 9-75 of the GST Act) of the supplies; and

for other supplies the entity makes during the year in the course of carrying on a business—the prices (as defined by section 9-75 of the GST Act) of the supplies.

Winding up a business

in that year the entity was winding up a business it previously carried on; and

the entity was a small business taxpayer for the income year in which it stopped carrying on that business.

plant that you acquired at or before 11.45 am, by legal time in the Australian Capital Territory, on 21 September 1999; or

a depreciating asset that is not plant and that you acquired before 1 July 2001;

is reduced (but not below nil) if:

for a paragraph (a) case—there would have been a reduction under subsection 42-192(2) of the former Act as a result of that event; or

for a paragraph (b) case—there would have been a reduction under subsection 42-192(2) of the former Act as a result of that event if the asset were plant.

for a depreciating asset that is plant:

the transferor referred to in 21 September 1999; orsection 40-340 of the new Act started to hold the plant under a contract entered into at or before 11.45 am, by legal time in the Australian Capital Territory, on

the transferor constructed it and the construction started at or before that time; or

the transferor acquired it in some other way at or before that time; or

the transferor acquired it from an entity that was working out the decline in value of the plant under subsection 40-10(3) or 40-12(3) of this Act and subparagraph (i), (ii) or (iii) of this paragraph applied to that entity or to the earliest successive transferor; or

for a depreciating asset that is not plant:

the transferor started to hold the asset under a contract entered into before 1 July 2001; or

the transferor constructed it and the construction started at or before that day; or

the transferor acquired it in some other way before that day.

the construction, manufacture, installation or acquisition of a water facility; or

the establishment of horticultural plants; or

the establishment of grapevines;

and you would have been able to deduct amounts for the qualifying amount for the income year in which 1 July 2001 occurs under the former Act if it had continued to apply.

the qualifying amount is taken to be:

for a water facility—the amount of capital expenditure you incurred on the construction, manufacture, installation or acquisition of the water facility; or

for a horticultural plant or a grapevine—the amount of capital expenditure incurred that is attributable to the establishment of the plant or grapevine; and

for horticultural plants, you use the effective life determined under section 387-175 of the former Act; and

(c) amounts that have been deducted or can be deducted for the qualifying amount under the former Act or the Income Tax Assessment Act 1936 are taken to be a decline in value under Subdivision 40-F of the new Act.

(a) you have deducted or can deduct an amount under qualifying amount) of expenditure on a water facility; andDivision 387 of the former Act for an amount (the

you do not hold the water facility at the start of 1 July 2001.

connecting or upgrading the supply of mains electricity to land; or

a telephone line on land;

and you hold the land to which the electricity or telephone line relates at the start of 1 July 2001.

Subdivision 387-F of the former Act; or

(b) former Income Tax Assessment Act 1936.section 70 of the

(a) you have deducted or can deduct an amount under qualifying amount) of expenditure on connecting or upgrading the supply of mains electricity to land or a telephone line on land; andDivision 387 of the former Act for an amount (the

you do not hold the land to which the electricity or telephone line relates at the start of 1 July 2001.

(a) you have deducted or can deduct amounts for a ship under Income Tax Assessment Act 1936 as in force before its repeal by Schedule 1 to the Tax Laws Amendment (Repeal of Inoperative Provisions) Act 2006; andsection 57AM of the

you hold the ship when this section commences.

(a) the cost of the ship when this section commences is its cost under the Income Tax Assessment Act 1936 just before that time; and

(b) the ship’s adjustable value when this section commences is its depreciated value under the Income Tax Assessment Act 1936 just before that time; and

(c) paragraphs 40-285(1)(a) and (2)(a) have effect as if amounts you have deducted or can deduct under Income Tax Assessment Act 1936, as in force before its repeal, are taken to be part of the ship’s decline in value under Subdivision 40-B of the Income Tax Assessment Act 1997.section 57AM of the

(a) the payment is received by you because you are entitled to it under a written contract, a law of the Commonwealth, a State, a Territory or another country, an instrument under such a law, a collective agreement within the meaning of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 or an AWA within the meaning of that Act; and

the entitlement is provided for under that contract, law, instrument or agreement as in force just before 10 May 2006.

by a method or formula for working out the amount;

by provision for you or another person (or entity) to make a choice between forms of payment allowing amounts to be worked out as provided by subsection (3) and paragraph (a) of this subsection.

a life benefit termination payment to which this Division applies; or

if this Division applies to only part of a life benefit termination payment—that part of the payment.

exceeds your low rate part (if any); and

does not exceed the amount worked out as follows: