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  • Immediate deduction for depreciating assets costing $300 or less



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

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    You can claim an immediate deduction for a depreciating asset costing $300 or less if you use the asset predominantly to produce assessable income that is not from carrying on a business -for example, rental income where your rental activities do not amount to the carrying on of a business. If you own an asset jointly with others, your interest in the asset is treated as the relevant depreciating asset -this means you may be able to claim an immediate deduction for your share of the cost of an asset you acquire jointly if your share is $300 or less (see Partners carrying on a rental property business).

    If you acquired the asset or your interest in it on or after 1 July 2000, there are two additional tests that must be met before an immediate deduction can be claimed:

    • the asset must not be part of a set of assets that you started to acquire in the same income year where the total cost of the set is more than $300, and
    • the total cost of the asset and any other identical, or substantially identical, assets that you start to acquire in an income year must not be more than $300.

    Example: Immediate deduction

    In November 2002, Terry purchased a toaster for his rental property at a cost of $70. He can claim an immediate deduction as he uses the toaster to produce assessable income, but not from carrying on a business.

    End of example


    Example: No immediate deduction

    Paula is buying a set of four identical bedside drawers costing $90 each for her rental property. She cannot claim an immediate deduction for any of these because they are identical and the total cost is more than $300.

    End of example

    For further information about immediate deductions for depreciating assets costing $300 or less, refer to the publication Capital allowances – $300 immediate deduction tests.

    Last modified: 04 Dec 2005QC 27452