Document ID: chunk:federal_register_of_legislation:C2025C00029:section:5:p2
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 5 (pt 2/3)
Character Range: 1018120–1020893

the facility; or
 (b) for a *horticultural plant—the amount of capital expenditure incurred on the plant; or
 (c) for a *fodder storage asset—the amount of capital expenditure incurred on the asset; or
 (d) for a *fencing asset—the amount of capital expenditure incurred on the asset.

Reduction of deduction: water facilities, fodder storage assets and fencing assets
 (4) You must reduce your deduction for a *water facility, *fodder storage asset or *fencing asset for an income year by the part of the decline in value of the facility or asset that is attributable to the period (if any) in the income year when it was:
 (a) not wholly used in carrying on a *primary production business on land in Australia; or
 (b) not wholly used for a *taxable purpose.
 (5) Paragraph (4)(a) does not apply to a *water facility if the expenditure incurred on the construction, manufacture, installation or acquisition of the water facility was incurred by an *irrigation water provider.

Meaning of irrigation water provider
 (6) An irrigation water provider is an entity whose *business is primarily and principally the supply (otherwise than by using a *motor vehicle) of water to entities for use in *primary production businesses on land in Australia.

40‑520  Meaning of water facility, horticultural plant, fodder storage asset and fencing asset
 (1) A water facility is:
 (a) *plant or a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to plant or a structural improvement, that is primarily and principally for the purpose of conserving or conveying water; or
 (b) a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to a structural improvement, that is reasonably incidental to conserving or conveying water.
Example: Examples of a water facility include a dam, tank, tank stand, bore, well, irrigation channel, pipe, pump, water tower and windmill. Examples of things reasonably incidental to conserving or conveying water include a culvert, a fence to prevent live stock entering an irrigation channel and a bridge over an irrigation channel.
 (2) A horticultural plant is a live plant or fungus that is cultivated or propagated for any of its products or parts.
 (3) A fodder storage asset is an asset or a structural improvement, or a repair of a capital nature, or an alteration, addition or extension, to an asset or a structural improvement, that is primarily and principally for the purpose of storing fodder.
 (4) A fencing asset is:
 (a) an asset or a structural improvement that is a fence; or
 (b) a repair of a capital nature, or an alteration, addition or extension, to a fence.

40‑525  Conditions

Water facilities
 (1) The capital expenditure you incurred on