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Minerals Resource Rent Tax Repeal and Other Measures Bill 2013

Schedule 3 Small business instant asset write-off threshold


Income Tax Assessment Act 1997

1  Section 328-170 (fourth paragraph)

Omit “$6,500”, substitute “$1,000”.

2  Section 328-180 (heading)

Repeal the heading, substitute:

328-180   Assets costing less than $1,000

3  Paragraph 328-180(1)(b)

Omit “$6,500”, substitute “$1,000”.

4  Paragraphs 328-180(2)(a) and (3)(a)

Omit “$6,500”, substitute “$1,000”.

5  Subsection 328-210(1)

Omit “$6,500”, substitute “$1,000”.

6  Subsection 328-210(3) (example)

Repeal the example, substitute:

Example:    Amanda’s Graphics is a small business entity for the 2014-15 income year and chooses to use this Subdivision for that year. The business has an opening pool balance of $8,500 for its general small business pool for that year.

                   During that year, Amanda acquired a new computer for $2,000. The taxable purpose proportion of its adjustable value is:

                   $2,000 x 80% business use estimate = $1,600

                   Amanda also sold her business car for $9,600 during that year. The car was used 100% in the business.

                   To work out whether she can deduct an amount under this section, Amanda uses this calculation:

                   $8,500 + $1,600 - $9,600 = $500

                   Because the result is less than $1,000, Amanda can deduct the $500 for the income year. The pool’s closing balance for the year is zero.

7  Subsection 328-215(4)

Omit “$6,500”, substitute “$1,000”.

8  Subsection 328-250(1)

Omit “$6,500”, substitute “$1,000”.

9  Subsection 328-250(4) (heading)

Repeal the heading, substitute:

Special rule for assets costing less than $1,000

10  Subsection 328-253(4) (heading)

Repeal the heading, substitute:

Special rule for expenditure on assets costing less than $1,000

11  Application of amendments

(1)       Subject to subitems (2) and (3), the amendments made by this Schedule apply to a depreciating asset if:

                     (a)  the asset was first installed ready for use, for a taxable purpose, on or after 1 January 2014; or

                     (b)  the asset was first used, for a taxable purpose, on or after 1 January 2014, but was not installed ready for use prior to that date.

(2)       The amendments made by item 4 of this Schedule apply to an amount if the amount is included in the second element of the cost of a depreciating asset at any time on or after 1 January 2014.

(3)       The amendments made by items 5 and 6 of this Schedule apply to assessments for income years finishing on or after 1 January 2014.