Document ID: chunk:federal_register_of_legislation:C2004C00927:clause:1_12:p3
Version: federal_register_of_legislation:C2004C00927
Segment Type: clause
Provision Reference: sch 1 cl 12 (pt 3/4)
Character Range: 242398–245042

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.

 (2) You make the choice for the income year in which a depreciation deduction is first allowable to you for the *plant.

42-105  How to work out effective life

 (1) You work out the *effective life of *plant by estimating how long it can be used by any entity for income producing purposes. You do this as at the time you first use it, or have it *installed ready for use, for the *purpose of producing assessable income.

 (2) In making that estimate, you assume that the *plant:
 (a) is new; and
 (b) will be subject to wear and tear at a rate that was reasonable for you to expect when you were working it out having regard to the expected circumstances of your use; and
 (c) will be maintained in reasonably good order and condition.

 (3) If, at that time, you conclude that you would be likely to scrap the *plant, sell it for scrap or abandon it before the end of the period worked out under subsection (1), its *effective life ends at the earlier time. This conclusion is also to be made on the assumption that the plant is new.

42-110  Commissioner's determination of effective life

 (1) The Commissioner may make a written determination specifying the *effective life of *plant.

 (2) Any conditions in the determination must be satisfied when you first use the *plant, or have it *installed ready for use, for the *purpose of producing assessable income.

Subdivision 42-D—Depreciation rates

Guide to Subdivision 42-D

42-115  What this Subdivision is about

      This Subdivision sets out the depreciation rates. More than one rate can apply depending on the nature of the plant and its use.

Table of sections

Operative provisions

42-120 Which rate do you use?
42-123 Change of rate
42-125 General rates
42-130 Low cost plant
42-135 Cars and motor cycles
42-140 Artworks
42-145 Scientific research
42-150 Employee amenities

Operative provisions

42-120  Which rate do you use?

 (1) If more than one rate can apply to your *plant, choose the one you prefer. However, in any case, you may choose a lower rate.

 (2) You make the choice for the income year in which a depreciation deduction is first allowable to you for the *plant.

42-123  Change of rate

 (1) You must make a new choice of rate if you were using the *plant as mentioned in section 42-145 (scientific research) or 42-150 (employee amenities) and you cease to use it in that way.

 (2) You