ato logo
Search Suggestion:

Uniform capital allowances

Last updated 26 April 2023

About uniform capital allowances and steps to follow to work out your deduction.

Uniform capital allowances rules

UCA provide a set of general rules that apply across a variety of depreciating assets and certain other capital expenditure. UCA do this by consolidating a range of former capital allowance regimes. UCA replace provisions relating to:

  • plant
  • software
  • mining and quarrying
  • intellectual property
  • forestry roads and timber mill buildings
  • spectrum licences.

UCA maintain the pre-1 July 2001 treatment of some depreciating assets and capital expenditure such as certain primary production depreciating assets and capital expenditure.

UCA introduced deductions for some types of capital expenditure such as certain business and project-related costs; see Capital expenditure deductible under UCA.

You use these rules to work out deductions for the cost of your depreciating assets, including those acquired before 1 July 2001. You can generally deduct an amount for the decline in value of a depreciating asset you held to the extent that you used it for a taxable purpose.

However, an eligible small business entity may choose to work out deductions for their depreciating assets using the simplified depreciation rules; see Small business entity concessions.

Steps to work out your deduction

Under UCA, there are a number of steps to work out your deduction for the decline in value of a depreciating asset.

Some of these steps do not apply:

  • if you choose to allocate an asset to a pool
  • if you can claim an immediate deduction for the asset
  • to certain primary production assets
  • to some assets used in rural businesses.

See Working out decline in value.