Document ID: chunk:federal_register_of_legislation:C2024C00267:section:3:p30
Version: federal_register_of_legislation:C2024C00267
Segment Type: section
Provision Reference: s 3 (pt 30/50)
Character Range: 152163–154741

other than:
 (i) as trading stock; or
 (ii) merely for the purposes of reasonable testing or trialling; or
 (b) you started holding the asset under section 40‑115 of the Income Tax Assessment Act 1997 (about splitting a depreciating asset) or section 40‑125 of that Act (about merging depreciating assets); or
 (c) you were already covered by this section for the asset as a member of a consolidated group or a MEC group of which you are no longer a member.
 (7A) The exception in subsection (7) also applies in relation to an asset if:
 (a) the asset is a licence (including a sub‑licence) relating to an intangible asset; and
 (b) the exception in that subsection applies in relation to the intangible asset.
 (8) However, paragraph (7)(a) does not apply in relation to an intangible asset unless the asset was used for the purpose of producing ordinary income before you first used it, or had it installed ready for use, for any purpose. In applying this subsection, disregard ordinary income that arises as a result of the disposal of the asset to you.

Exception—assets to which Division 40 does not apply
 (9) Despite subsection (1), you are not covered by this section for the asset if Division 40 of the Income Tax Assessment Act 1997 does not apply to the asset because of section 40‑45 of that Act.

Exception—assets not located in Australia
 (10) Despite subsection (1), you are not covered by this section for the asset if, at the time you first use the asset, or have it installed ready for use, for a taxable purpose:
 (a) it is not reasonable to conclude that you will use the asset principally in Australia for the principal purpose of carrying on a business; or
 (b) it is reasonable to conclude that the asset will never be located in Australia.

40‑130  Method for working out accelerated decline in value
 (1) For the purposes of section 40‑120, the decline in value for the income year in which paragraph 40‑120(1)(a) is satisfied (the current year) is:
 (a) if the asset's start time occurs in the current year—the amount worked out under subsection (2); or
 (b) if the asset's start time occurred in an earlier year—the amount worked out under subsection (4).
Note 1: The asset's start time is when you first use it, or have it installed ready for use, for any purpose (including a non‑taxable purpose): see subsection 40‑60(2) of the Income Tax Assessment Act 1997.
Note 2: A case covered by paragraph (b) is where you start to hold the asset in the period 12 March 2020 to 30 June 2020 and use it for only non‑taxable purposes in that period, then first