Document ID: chunk:federal_register_of_legislation:C2024C00267:section:3:p23
Version: federal_register_of_legislation:C2024C00267
Segment Type: section
Provision Reference: s 3 (pt 23/50)
Character Range: 136022–138544

(c) 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.
 (3) The Income Tax Assessment Act 1997 applies to you as if you had started to hold a depreciating asset (the substituted asset) before 10 May 2006 if:
 (a) you started to hold the substituted asset on or after that day under an arrangement; and
 (b) 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
 (c) you did not deal with the other entity at arm's length; and
 (d) 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.

40‑75  Mining expenditure incurred after 1 July 2001 on an asset
 (1) This section applies to you if:
 (a) you hold a depreciating asset (except a mining, quarrying or prospecting right that you started to hold before 1 July 2001) that you:
 (i) started to hold under a contract entered into before 1 July 2001; or
 (ii) constructed where the construction started before that day; or
 (iii) started to hold in some other way before that day; and
 (b) 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 Division 330 of the former Act if it had been incurred before 1 July 2001.
 (2) If you incur expenditure on the asset after 30 June 2001 that forms part of the cost of the asset, you can deduct the expenditure for the income year in which you incur it if it would have been expenditure on exploration or prospecting within the meaning of Division 330 of the former Act.
 (3) Otherwise, Subdivision 40‑B of the new Act applies to the asset on the basis that it has a cost, and an adjustable value, of zero at the start of 1 July 2001, and an effective life on that day or at its start time, whichever is the later, worked out under subsection (4) of this section.
 (4) The effective life of the depreciating asset is the shorter of its effective life worked out under Division 40 and:
 (a) 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:
 (i) 10 years; and
 (ii) the number of whole years in the