Document ID: chunk:federal_register_of_legislation:C2004C00927:clause:1_4:p2
Version: federal_register_of_legislation:C2004C00927
Segment Type: clause
Provision Reference: sch 1 cl 4 (pt 2/8)
Character Range: 56356–59056

not capital expenditure merely because the *tax affairs concerned relate to matters of a capital nature.

Example: Under this section, you can deduct expenditure you incur in applying for a private ruling on whether you can depreciate an item of property.

Use of property taken to be for income producing purpose

 (5) Under some provisions of this Act it is important to decide whether you used property for the *purpose of producing assessable income. For provisions of that kind, your use of property is taken to be for that purpose insofar as you use the property for:
 (a) managing your *tax affairs; or
 (b) complying with an obligation imposed on you by a *Commonwealth law, insofar as that obligation relates to the *tax affairs of another entity.

Example: You buy a computer to prepare your tax returns. The expenditure you incur in buying the computer is capital expenditure and cannot be deducted under this section.

 However, to the extent that you use the computer in preparing your income tax return, you will be able to depreciate your computer and deduct an amount under section 54 (Depreciation) of the Income Tax Assessment Act 1936. That is because, under this subsection, the computer is property that you are taken to use for the purpose of producing assessable income.

 (6) If another provision of this Act expressly provides that a particular use of property is not taken to be for the *purpose of producing assessable income, that provision overrides subsection (5).

25-10  Repairs

 (1) You can deduct expenditure you incur for repairs to premises (or part of premises), *plant, machinery, tools or articles that you held or used solely for the *purpose of producing assessable income.

Property held or used partly for that purpose

 (2) If you held or used the property only partly for that purpose, you can deduct so much of the expenditure as is reasonable in the circumstances.

No deduction for capital expenditure

 (3) You cannot deduct capital expenditure under this section.

25-15  Amount paid for lease obligation to repair

  You can deduct an amount that you pay for failing to comply with a lease obligation to make repairs to premises if you use or have used the premises for the *purpose of producing assessable income.

Note: The amount is assessable income of the entity to which you pay it: either as ordinary income under section 6-5 or because it is included by section 15-25.

25-20  Lease document expenses

 (1) You can deduct expenditure you incur for preparing, registering or stamping:
 (a) a lease of property; or
 (b) an assignment or surrender of a lease of property;
if you have used or will use the property solely for the *purpose