• ## Calculating your deduction where the 12-month rule is not satisfied

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Where you incur non-business expenditure and the eligible service period is more than 12 months or it ends after the last day of the next income year, you must use the following formula to work out your deduction:

 Expenditure X number of days of eligible service period in the income yeartotal number of days of eligible service period

Example

Deduction for non-business expenditure with an eligible service period of more than 12 months

On 1 January 2002, Martin, a senior clerk employed by a legal firm, paid \$1,250 subscription for the monthly provision of a professional journal to cover the period 1 January 2002 to 31 January 2003. As the eligible service period is more than 12 months, Martin must apportion his deduction over the 2002 and 2003 income years. Martin's deductions are:

2001-02

 \$1,250 X 181396 (1 January 2002 to 30 June 2002) = \$571

2002-03

 \$1,250 X 215396 (1 July 2002 to 31 January 2003) = \$679

Over the 2002 and 2003 income years, Martin will get a total deduction of \$1,250.