The effective life of a depreciating asset is used to work out the asset’s decline in value (or depreciation) which is used to claim an income tax deduction.
We provide effective life determinations for either:
- depreciating assets used by a particular industry
- a single asset commonly used by different industries.
We previously published a new effective life determination for certain depreciating assets each year. The determination is also published annually in a new taxation ruling (effective life ruling), see Taxation Ruling TR 2022/1 Income tax: effective life of depreciating assets (applicable from 1 July 2022).
The updates to the process we are considering include:
- publishing the effective life ruling content on ato.gov.au, with links to the latest Legislative Instrument CompilationExternal Link for Tables A and B of the Schedule
- phasing out annual effective life reviews to instead make determinations as required.
We encourage you to take this opportunity to send us your feedback and contribute to shaping our future interactions with you.
Please send your feedback by 1 June 2023 to EffectiveLifeCOE@ato.gov.au.We're updating how we publish effective life determinations. Your feedback can help shape this process.