Guide to depreciating assets 2005-06

Warning: This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

Effective life of intangible depreciating assets

The effective life of most intangible depreciating assets is prescribed under the UCA.

Asset

Effective life in years

1

Standard patent

20

2

Innovation patent

8

3

Petty patent

6

4

Registered design

15

5

Copyright (except copyright in a film)

The shorter of 25 years from when you acquire it or the period until the copyright ends

6

A licence (except one relating to a copyright or in-house software)

The term of the licence

7

A licence relating to a copyright (except copyright in a film)

The shorter of 25 years from when you become the licensee or the period until the licence ends

8

In-house software

2 ½

9

Spectrum licence

The term of the licence

10

Datacasting transmitter licence

15

11

A mining, quarrying or prospecting right relating to mining operations (except obtaining petroleum or quarry materials)

The life of the mine or proposed mine or, if there is more than one, the life of the mine that has the longest estimated life

12

A mining, quarrying or prospecting right relating to mining operations to obtain petroleum

The life of the petroleum field or proposed petroleum field

13

A mining, quarrying or prospecting right relating to mining operations to obtain quarry materials

The life of the quarry or proposed quarry or, if there is more than one, the life of the quarry that has the longest estimated life

14

Telecommunications site access right

The term of the right

You do not have a choice to either work out the effective life yourself or use an effective life determined by the Commissioner for the intangible depreciating assets. In addition, the effective life of these depreciating assets cannot be recalculated.

The effective life of an indefeasible right to use a telecommunications cable system is the effective life of the telecommunications cable over which the right is granted.

The effective life of any other intangible depreciating asset cannot be longer than the term of the asset as extended by any reasonably assured extension or renewal of that term.

If you acquire any of the intangible assets listed in the table (except items 5, 7 or 8) from a former holder and you choose to calculate the asset's decline in value using the prime cost method, you must replace the effective life shown in the table in the formula with the number of years remaining in that effective life as at the start of the income year you acquired the asset.

Sections within Effective life

Last Modified: Tuesday, 18 July 2006