For most depreciating assets, you have a choice to either work out the effective life yourself or use an effective life determined by the Commissioner.
You must make the choice for the income year in which the asset's start time occurs. Generally, you must make the choice by the time you lodge your income tax return for that year.
However, the choice is not available:
- for most intangible depreciating assets - see Effective life of intangible depreciating assets
- if a depreciating asset was acquired from an associate who claimed or could have claimed deductions for the asset's decline in value - see Depreciating asset acquired from an associate.
- for a depreciating asset which you started to hold but the user of the asset did not change or is an associate of the former user - for example, under a sale and leaseback arrangement - see Sale and leaseback arrangements
- if there has been rollover relief - see Rollover relief.