A deduction is available for capital expenditure incurred by primary producers and other landholders on:
- landcare operations
- connection of a mains electricity cable to a metering point or the upgrading of a connection, provided the electricity is used for a taxable purpose, and
- a telephone line brought on or extending to land used in a primary production business.
These deductions are not available to a partnership. Costs incurred by a partnership are allocated to each partner who can claim a deduction for their share of the relevant capital expenditure.
Such capital expenditure may be incurred on a depreciating asset. However, if the expenditure is deductible under these rules, you cannot use the general rules for working out decline in value or claim the immediate deduction for depreciating assets costing $300 or less.
If the capital expenditure is incurred on a depreciating asset and you are a primary producer and an STS taxpayer, you can choose to work out your deductions for these depreciating assets using either the STS capital allowance rules or the UCA rules. For more information about STS taxpayers, see STS taxpayers.