ATO ID 2003/946: Capital Allowances: Low-value pools - allocating substantially identical assets
Date of decision: 10 September 2003
Year of income: Year ended 30 June 2003
Business line: Private Groups and High Wealth Individuals

Issue
Can a depreciating asset which cost less than $1,000 be allocated to a low-value pool under section 40-425 of the Income Tax Assessment Act 1997 (ITAA 1997) even if the total cost of all substantially identical items acquired by the taxpayer in that income year exceeded $1,000?

Decision
Yes. Regardless of the total cost of all substantially identical items acquired during the income year, if the item is a depreciating asset which cost less than $1,000 and the cost is not immediately deductible under subsection 40-80(2) of the ITAA 1997, it can be allocated to the low-value pool under section 40-425 of the ITAA 1997, provided the other conditions of the provision are met.

Facts
A taxpayer acquired, in one purchase, several blinds for the windows in a rental property. The cost of each blind was between $100 and $500, but the total cost of the blinds exceeded $1,000. The blinds are substantially identical as they are: The only difference between the blinds is their size, which is dictated by the size of the window in the relevant room.

Reasons for decision

Legislative references: Income Tax Assessment Act 1997 section 40-425. subsection 40-425(1). subsection 40-425(2). subsection 40-425(4). subsection 40-80(2).
Related ATO interpretative decisions: ATO ID 2003/80
Subject references: Capital Allowances CoE Low value pool Substantially identical depreciating assets Uniform capital allowances system