The Income Tax (Effective Life of Depreciating Assets) Amendment Determination 2013 (No 1) was registered on the Federal Register of Legislative Instruments on Fri 7.6.2013. It commences on 1 July 2013 and amends the Income Tax (Effective Life of Depreciating Assets) Determination 2001 to provide taxpayers in specific industries and for specific assets with effective lives as a basis to calculate the decline in value (depreciation) of an asset for income tax purposes.
The Determination provides taxpayers with a choice under the ITAA 1997, when measuring the decline in value (depreciation) of an asset, because a taxpayer can either use an effective life determined by the Commissioner, or work out (self-assess) their own effective life of an asset in accordance with section 40-105 of the ITAA 1997.
Taxation Ruling 2013/4 explains the factors the Commissioner takes into account when making effective life determinations. Those factors include commercial and technical obsolescence; to the extent it is predictable.
[LTN 109, 7/6/13]