Capital allowances

Capital allowances: effective life review for certain determinations in Table A of Taxation Ruling TR 2015/2 – review to begin

We are reviewing certain determinations in Table A of Taxation Ruling TR 2015/2 – ‘the schedule’ to make new effective life determinations.

You use effective lives to work out how much you can claim as a tax deduction for an asset’s decline in value (depreciation deduction). The purpose of our review is to ensure our effective life determinations cover all assets commonly used by your industry, and reflect current industry practices and expectations. Our determinations provide you with ‘safe harbour lives’. You also have the option to self-assess effective lives.

We anticipate the review will cover assets used in industries or operations such as:

AGRICULTURE, FORESTRY AND FISHING (01110 TO 05290)
Agriculture (01110 TO 01990)
ASSET	LIFE (YEARS)	REVIEWED	DATE OF APPLICATION
Bee farming plant:
Beehives	131/3		1 Jan 2001
Processing plant	20		1 Jan 2001
Hop growers’ plant:
Hop picking machines	131/3		1 Jan 2001
Kilns	20		1 Jan 2001
Pea-viners, pea cleaners, vine and straw conveyors	10		1 Jan 2001

 

MANUFACTURING (11110 TO 25990)
Poultry processing (11120)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Conveyor systems and troughing	20			1 Jan 2001
General plant	131/3			1 Jan 2001
Refrigeration plant and boiler	10			1 Jan 2001
Fruit and vegetable processing (11400)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Fruit and vegetable canning plant	20			1 Jan 2001
Jam-making plant	20			1 Jan 2001
Grain mill product processing (11610)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Flour-milling plant:
Bins (wooden)	331/3			1 Jan 2001
General plant	131/3			1 Jan 2001
Linseed oil manufacturing plant	131/3			1 Jan 2001
Rice milling plant	131/3			1 Jan 2001
Confectionery manufacturing (11820)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Confectioners’ machinery	20			1 Jan 2001
Soft drink, cordial and syrup manufacturing (12110)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Ice-making machinery:
Condensers	131/3			1 Jan 2001
Expansion pipes	40			1 Jan 2001
General machinery	131/3			1 Jan 2001
Ice moulds	5			1 Jan 2001
Spirit manufacturing (12130)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Distillery plant (brandy etc)	131/3			1 Jan 2001
Cigarette and tobacco product manufacturing (12200)
ASSET	LIFE (YEARS)		REVIEWED	DATE OF APPLICATION
Tobacco kilns	20			1 Jan 2001
Pulp, paper and converted paper product manufacturing (15100, 15210, 15220 and 15290)
ASSET		LIFE (YEARS)	REVIEWED	DATE OF APPLICATION
Cigarette paper cutting and folding plant		10		1 Jan 2001

 

OTHER SERVICES (94110 TO 96030)
Photographic film processing (95320)
ASSET	LIFE (YEARS)	REVIEWED	DATE OF APPLICATION
Mini lab	10		1 Jan 2001
Photo engraving plant:
Automatic (dark room) cameras	10		1 Jan 2001
General plant	20		1 Jan 2001
Powderless etching machines	10		1 Jan 2001
Power operated proofing presses	131/3		1 Jan 2001
Photo lab (one-hour service)	10		1 Jan 2001

We expect to complete our review of these assets within 12 months, with new effective life determinations applying from 1 July 2016. Draft effective lives will be issued for public comment well before final decisions are made.

As part of this review, we will:

• Identify the assets currently used in the industry
• Consult with major interest groups, such as industry representative bodies, users and suppliers (including using interviews and site asset inspections)
• Complete a report with recommendations for new effective lives based on an analysis of the factors listed in the effective life taxation ruling
• Remove redundant items currently in the effective life schedule.

See also:

TR 2015/External Link Income tax: effective life of depreciating assets (applicable from 1 July 2015)

Participation in the review process is entirely voluntary. However, we find strong participation from an industry gives members confidence that will properly consider their range of experience, and that the determinations will be useful to industry members.

If you would like to participate in the review, contact the ATO:-

for:

• Bee farming plant (01110 to 01990)
• Pea-viners, pea cleaners, vine and straw conveyors (01110 to 01990)
• Fruit and vegetable processing (11400)
• Grain mill product manufacturing (11610)
• Cigarette and tobacco manufacturing (12200)
• Pulp, paper and converted paper product manufacturing (15100, 15210, 15220 and 15290)
• Photographic film processing (95320)

for:

• Hop growers’ plant (01110 to 01990)
• Poultry processing (11120)
• Confectionary manufacturing (11820)
• Soft drink, cordial and syrup manufacturing (12110)
• Spirit manufacturing (12130)

Source:- www.ato.gov.au