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Is a deduction for depreciation of an automatic hydraulic door closer, a smoke alarm, gymnasium equipment and security swipe card system contained in a rental property available under section 42-15 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Yes. All of the items satisfy the definition of 'plant' and a depreciation deduction is available under section 42-15 of the ITAA 1997.

The taxpayer owns a rental property which is rented or available for rent on a commercial basis at all times. The taxpayer wants to claim depreciation deductions in respect of certain items contained in the property on the basis that the items are 'plant' for depreciation purposes. The items are: • Automatic hydraulic door closer (inter-related mechanical parts with separate functions to detect an opened door and to close it without human intervention) • Smoke alarm (interrelated parts with separate functions to detect smoke and to transmit signal and sound) • Gymnasium equipment (freestanding machines used for various forms of exercise); and • Security swipe card system (mechanical apparatus that reads a swiped card in order to control access through external doors of a building).

Section 42-15 of the ITAA 1997 allows a deduction for depreciation of a unit of plant that is owned and used for the purpose of producing assessable income.

Plant is defined in section 42-18 of the ITAA 1997 to include articles and machinery. An item that falls within the meaning of machinery will always be plant, irrespective of whether or not it is annexed to land or buildings ( Carpentaria Transport Pty Ltd v. F C of T (1990) 20 ALD 769; (1990) 21 ATR 513; 90 ATC 4590).

The automatic hydraulic door closer, smoke alarm, gymnasium equipment and security swipe card system are all considered to be either articles or machinery and, therefore, plant.

As the plant is owned and used for the required purpose, a depreciation deduction is available to the taxpayer.