Commonwealth Consolidated Acts

INCOME TAX ASSESSMENT ACT 1997 - SECT 27.85

  (1)   This section applies to an entity if:

  (a)   the entity can deduct amounts for a * depreciating asset under Division   40 or 328; and

  (b)   the entity has a * decreasing adjustment in an income year that relates directly or indirectly to the asset.

  (1A)   However, this section does not apply to a * decreasing adjustment that arises under Division   129 or 132 of the * GST Act.

Note:   See instead section   27 - 87.

  (2)   The asset's * cost is reduced by an amount equal to the * decreasing adjustment if the adjustment arises in the income year in which the asset's * start time occurs.

  (3)   The asset's * opening adjustable value for an income year and its * cost is reduced by an amount equal to the * decreasing adjustment if the adjustment arises in that year and that year is after the one in which the asset's * start time occurs.

  (4)   If the reduction under subsection   (2) or (3) is more than:

  (a)   for a subsection   (2) case--the * depreciating asset's * cost; or

  (b)   for a subsection   (3) case--the depreciating asset's * opening adjustable value;

the excess is included in the entity's assessable income unless the entity is an * exempt entity.

Exception: pooling

  (5)   This section does not apply to:

  (a)   a depreciating asset allocated to a low - value pool or a pool under Division   328 for or in the * current year; or

  (b)   * in - house software if expenditure on the software is allocated to a software development pool for the current year; or

  (c)   a project pool.