Document ID: chunk:federal_register_of_legislation:C2004C00927:clause:1_12:p2
Version: federal_register_of_legislation:C2004C00927
Segment Type: clause
Provision Reference: sch 1 cl 12 (pt 2/4)
Character Range: 239907–242655

be taken into account in working out an amount you can deduct, other than for depreciation.

 (2) Subsection (1) does not apply to deductions for:
 (a) research and development (section 73B of the Income Tax Assessment Act 1936);
 (b) development and investment allowances (Subdivisions B and BA of Division 3 of Part III of that Act);
 (c) drought investment allowance (Part XII of that Act).

42-90  Adjustment: previously depreciated plant limit

 (1) The Commissioner may limit the cost to you of *plant for which an amount has been deducted or can be deducted for depreciation by any earlier owner or *quasi-owner.

 (2) The cost of the *plant may be limited to the sum of:
 (a) its *written down value, immediately before the *balancing adjustment event occurred, in the hands of 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 plant under Subdivision 42-F or 42-G; and
 (c) any balancing adjustment that would have been included in that entity's assessable income for the plant if balancing adjustment relief under section 42-285 (same year relief) or 42-290 (later year relief) had not applied.

 (3) If the last entity had the *plant in a *pool for the income year in which the *balancing adjustment event occurred, its cost may be limited to the sum of:
 (a) any balancing adjustment included in that entity's assessable income for the plant under section 42-390; and
 (b) any balancing adjustment that would have been included in that entity's assessable income for the plant if balancing adjustment relief under section 42-285 or 42‑290 had not applied.

 (4) The matters to be taken into account by the Commissioner in deciding whether to limit the cost of *plant include:
 (a) whether you acquired the plant from an *associate; and
 (b) the market value of the plant; and
 (c) how the purchase price of the plant was calculated; and
 (d) how the acquisition was financed; and
 (e) whether the plant is for use by the entity from whom you acquired it or by an associate of the entity.

Subdivision 42-C—Effective life

Guide to Subdivision 42-C

42-95  What this Subdivision is about

      The rate at which you depreciate plant is generally determined by its effective life. There are 2 methods of working out effective life.

Table of sections

Operative provisions

42-100 Choice of method
42-105 How to work out effective life
42-110 Commissioner's determination of effective life

Operative provisions

42-100  Choice of method

 (1) You must either:
 (a) work out the *effective life of *plant; or
 (b) adopt the *effective life specified by the Commissioner (if any) for the plant under section 42-110.