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46 Intangible depreciating assets first deducted

Last updated 11 February 2019

If the trust is a small business entity using the simplified depreciation rules, do not include an amount at this item.

The following intangible assets are regarded as depreciating assets (as long as they are not trading stock):

  • certain items of intellectual property such as patents, registered designs, copyrights and certain types of licences of these
  • computer software, or a right to use computer software, that the trust acquires, develops or has someone else develop for its own use (in-house software)
  • mining, quarrying or prospecting rights and information
  • spectrum licences
  • datacasting transmitter licences
  • certain indefeasible rights to use telecommunications cable systems (IRUs)
  • some access rights to telecommunications sites.

A depreciating asset that the trust holds starts to decline in value from the time the trust uses it (or installs it ready for use) for any purpose, including a private purpose. However, the trust can only claim a deduction for the decline in value to the extent it uses the asset for a taxable purpose, such as for producing assessable income.

Show at N the cost of all intangible depreciating assets for which the trust is claiming a deduction for decline in value for the first time. If the trust has allocated any intangible depreciating assets with a cost of less than $1,000 to a low-value pool for the income year, include the cost of those assets at N. Do not reduce the cost for estimated non-taxable use.

Do not include expenditure on in-house software which has been allocated to a software development pool at N.

For more information on decline in value, cost, low-value pools, in-house software and software development pools, see the Guide to depreciating assets 2012.