Document ID: chunk:federal_register_of_legislation:C2004C00927:clause:1_3:p22
Version: federal_register_of_legislation:C2004C00927
Segment Type: clause
Provision Reference: sch 1 cl 3 (pt 22/24)
Character Range: 465714–468489

deductions, take account of amounts deducted or deductible under section 124F or 124JA of the Income Tax Assessment Act 1936 for the road or building. See section 387‑472 of the Income Tax (Transitional Provisions) Act 1997.

Limits on deductions

387‑475  Limits on expenditure on acquiring a road or building

 (1) If you acquired the road or building from another entity, the Commissioner may limit your capital expenditure for the purposes of section 387‑470.

 (2) Your capital expenditure may be limited to the sum of:
 (a) the amount that, if the entity had not disposed of the road or building to you, would have been the difference between the entity's capital expenditure and previous deductions (as those terms are defined in section 387‑470) at the end of the income year during which the disposal took place; and
 (b) any amount included in the entity's assessable income under subsection 387‑485(3) as a result of a balancing adjustment required by the disposal.

 (3) If you incurred capital expenditure acquiring a building that is *plant for which an amount has been deducted or can be deducted for depreciation by any earlier owner or *quasi-owner, your capital expenditure may be limited to the sum of:
 (a) the *written down value (as defined in section 42-200, which relates to deductions for depreciation) of the building immediately before it was disposed of by the last entity who had deducted or can deduct an amount for depreciation of it; and
 (b) any balancing adjustment included in that entity's assessable income for the building under Subdivision 42‑F (which explains how to make a balancing adjustment for depreciated *plant); and
 (c) any balancing adjustment that would have been included in that entity's assessable income if balancing adjustment relief had not applied under section 42‑285 or 42‑290 (both of which let you exclude from your assessable income amounts that would be included in that income under the balancing adjustment).

 (4) The matters the Commissioner must take into account in deciding whether to limit your capital expenditure include:
 (a) whether you acquired the road or building from an *associate; and
 (b) the market value of the road or building; and
 (c) how the purchase price of the road or building was calculated; and
 (d) how your acquisition of the road or building was financed.

387‑480  When you cannot deduct

When your deductions equal your whole expenditure

 (1) You cannot deduct an amount under this Subdivision for the *current year for your expenditure on a *forestry road or a *timber mill building if the sum of the amounts that you have deducted or can deduct under this Subdivision for that expenditure for earlier income years equals that expenditure.

Note: Take account of amounts