Under the UCA, there are a number of steps in working out your deduction for the decline in value of a depreciating asset:
- Is your asset a depreciating asset covered by the UCA?
- see What is a depreciating asset? - Do you hold the depreciating asset?
- see Who can claim deductions for the decline in value of a depreciating asset? - Has the depreciating asset started to decline in value?
- see When does a depreciating asset start to decline in value? - What method will you use to work out decline in value?
- see Methods of working out decline in value. - What is the effective life of the depreciating asset?
- see effective life. - What is the cost of your depreciating asset?
- see The cost of a depreciating asset. - Must you reduce your deduction for any use for other than a taxable purpose?
- see Decline in value of a depreciating asset used for other than a taxable purpose.
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.