Income Tax Assessment Act 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION

PART 2-10 - CAPITAL ALLOWANCES: RULES ABOUT DEDUCTIBILITY OF CAPITAL EXPENDITURE

Division 40 - Capital allowances

View history reference

Subdivision 40-J - Capital expenditure for the establishment of trees in carbon sink forests

Operative provisions

SECTION 40-1030 Extra deduction for destruction of trees in carbon sink forest

40-1030(1)
You can deduct the amount worked out under subsection (2) for an income year if:

(a) you or another entity incurred capital expenditure that is covered under section 40-1010 in relation to particular trees; and

(b) you use the land occupied by the trees for the primary and principal purpose of *carbon sequestration by the trees; and

(c) the trees are destroyed during the income year; and

(d) you satisfy a condition in subsection 40-1005(5) for the trees just before they are destroyed.

40-1030(2)
Work out the amount of the deduction as follows: Method statement

Step 1.

Work out the total of the amounts you could have deducted under this Subdivision in relation to the trees for the period:

(a) starting on the first day of the income year in which the trees are established; and

(b) ending when the trees were destroyed;

assuming that, during that period, you satisfied a condition in the table in subsection 40-1005(5) .

Step 2.

Subtract from the expenditure that is covered under section 40-1010 in relation to the trees:

(a) the result from step 1; and

(b) any amount you received (under an insurance policy or otherwise) for the destruction.

The remaining amount (if positive) is your deduction under subsection (1).

40-1030(3)
This deduction is in addition to any deduction for the income year under section 40-1005 .