Income tax: if a purchase of depreciable plant comprises individual items costing $300 or less each or having an effective life of less than 3 years, can these individual items be depreciated at the rate of 100% in terms of subsection 55(2) of the Income Tax Assessment Act 1936?

Taxation Determination TD 93/159, which issued on 12 August 1993, deals with the application of subsection 55(2) of the Income Tax Assessment Act 1936 (ITAA 1936) which allows units of property to be depreciated at a rate of 100% if they cost $300 or less or have an effective life of less than 3 years. The Determination explains that, if a purchase of depreciable plant comprises more than one item, the tests in subsection 55(2) are applied to each unit of property to work out whether each can be depreciated at the rate of 100%. The Determination sets out guidelines for identifying the unit(s) of property.

Subsection 55(2) of the ITAA 1936 does not apply to the 1997-98 income year and later years. [1]

As the legislation dealt with in TD 93/159 no longer applies, the Determination is withdrawn.