If you acquired plant on or after 9 May 2001 or another depreciating asset after 1 July 2001 but the user of the asset does not change or is an associate of the former user-such as under a sale and leaseback arrangement-you must use the same method of working out the decline in value that the former holder used.
You must also use the effective life the former holder used if they used the diminishing value method. If they used the prime cost method you use any remaining period of the effective life used by them.
If you cannot readily ascertain the method the former holder used or if they did not use a method, you must use the diminishing value method. An effective life determined by the Commissioner of Taxation must be used if you cannot find out the effective life the former holder used or if they did not use an effective life.
You must recalculate the effective life of the depreciating asset if the asset's cost increases by 10% or more in any income year, including the year in which you start to hold it see How to recalculate effective life for information about recalculating effective life.