INCOME TAX ASSESSMENT ACT 1997 - SECT 40.440 How you work out the decline in value of assets in low - value pools
INCOME TAX ASSESSMENT ACT 1997 - SECT 40.440
How you work out the decline in value of assets in low - value pools(1) You work out the decline in value of * depreciating assets in a low - value pool for an income year in this way:
Step 1. Work out the amount obtained by taking 18 3 / 4 % of the taxable use percentage of the * cost of each * low - cost asset you allocated to the pool for that year. Add those amounts.
Step 2. Add to the step 1 amount 18 3 / 4 % of the taxable use percentage of any amounts included in the second element of the * cost for that year of:
(a) assets allocated to the pool for an earlier income year; and
(b) * low - value assets allocated to the pool for the * current year.
Step 3. Add to the step 2 amount 37 1 / 2 % of the sum of:
(a) the * closing pool balance for the previous income year; and
(b) the taxable use percentage of the * opening adjustable values of * low - value assets, at the start of the income year, that you allocated to the pool for that year.
Step 4. The result is the decline in value of the * depreciating assets in the pool.
(2) The closing pool balance of a low - value pool for an income year is the sum of:
(a) the * closing pool balance of the pool for the previous income year; and
(b) the taxable use percentage of the * costs of * low - cost assets you allocated to the pool for that year; and
(c) the taxable use percentage of the * opening adjustable values of any * low - value assets you allocated to the pool for that year as at the start of that year; and
(d) the taxable use percentage of any amounts included in the second element of the cost for the income year of:
(i) assets allocated to the pool for an earlier income year; and
(ii) low - value assets allocated to the pool for the * current year;
less the decline in value of the * depreciating assets in the pool worked out under subsection (1).
Note: The closing pool balance may be reduced under section 40 -
445 if a balancing adjustment event happens.