Document ID: chunk:federal_register_of_legislation:C2010C00617:clause:6_7:p1
Version: federal_register_of_legislation:C2010C00617
Segment Type: clause
Provision Reference: sch 6 cl 7 (pt 1/2)
Character Range: 95868–98517

7  At the end of Division 42
Add:

Subdivision 42‑M—Low‑value pools

Guide to Subdivision 42‑M

42‑445  What this Subdivision is about

      This Subdivision allows you to calculate your depreciation deductions for certain plant through a low‑value pool.

Table of sections

Operative provisions

42‑450 Creating a low‑value pool
42‑455 Allocating plant to low‑value pools
42‑460 Rules for plant in low‑value pools
42‑465 Private or exempt use of plant
42‑470 Deductions for plant in low‑value pools
42‑475 Balancing adjustment events

[This is the end of the Guide.]

Operative provisions

42‑450  Creating a low‑value pool

  You may choose to create a low‑value pool by recording in writing the first income year in which you allocate *plant to it.

42‑455  Allocating plant to low‑value pools

 (1) You may choose to allocate *low‑cost plant to a *low‑value pool for the income year in which you become its owner or *quasi‑owner.

 (2) Low‑cost plant is *plant whose *cost is less than $1,000.

 (3) You may also choose to allocate *plant to a *low‑value pool for an income year if:
 (a) you have deducted or can deduct an amount for depreciation of the plant for a previous income year using the *diminishing value method; and
 (b) the *undeducted cost of the plant at the start of the income year is less than $1,000.

42‑460  Rules for plant in low‑value pools

 (1) Once you have made a choice to allocate *low‑cost plant to a *low‑value pool for an income year, you must allocate all low‑cost plant of which you become the owner or *quasi‑owner in that income year or a later one to such a pool.

 (2) However, you cannot allocate any *plant to a *low‑value pool for an income year if you are a *small business taxpayer for that year.

 (3) Once you allocate *plant to a *low‑value pool, it must remain in the pool.

 (4) You cannot allocate *low‑cost plant to a *low‑value pool if:
 (a) its *cost does not exceed $300; and
 (b) you:
 (i) became the owner or *quasi‑owner of the plant under a contract entered into before 1 July 2000; or
 (ii) constructed it and the construction started before that day; or
 (iii) acquired it in some other way before that day.

 (5) You cannot allocate *plant to a *low‑value pool if you have allocated it to a pool under Subdivision 42‑L.

42‑465  Private or exempt use of plant

 (1) When you allocate *plant to a *low‑value pool, you must make an estimate of the percentage (if any) of your proposed use of the plant that will be for purposes other than the *purpose of producing assessable income.

 (2) For *low‑cost plant, you must reduce its *cost by an amount representing the percentage