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  

Subdivision 40-H - Capital expenditure that is immediately deductible  

Operative provisions

SECTION 40-755   Environmental protection activities  

40-755(1)    
You can deduct expenditure you incur in an income year for the sole or dominant purpose of carrying on * environmental protection activities.

Note:

If Division 250 applies to you and an asset that is land:

  • (a) if section 250-150 applies - you cannot deduct expenditure you incur in relation to the land to the extent specified under subsection 250-150(3) ; or
  • (b) otherwise - you cannot deduct such expenditure.

  • 40-755(2)    
    Environmental protection activities are any of the following activities that are carried on by or for you:


    (a) preventing, fighting or remedying:


    (i) pollution resulting, or likely to result, from * your earning activity; or

    (ii) pollution of or from the site of your earning activity; or

    (iii) pollution of or from a site where an entity was carrying on any * business that you have acquired and carry on substantially unchanged as your earning activity;


    (b) treating, cleaning up, removing or storing:


    (i) waste resulting, or likely to result, from your earning activity; or

    (ii) waste that is on or from the site of * your earning activity; or

    (iii) waste that is on or from a site where an entity was carrying on any business that you have acquired and carry on substantially unchanged as your earning activity.

    No other activities are environmental protection activities.


    40-755(3)    
    Your earning activity is an activity you carried on, carry on, or propose to carry on:


    (a) for the * purpose of producing assessable income for an income year (except a * net capital gain); or


    (b) for the purpose of * exploration or prospecting; or


    (c) for the purpose of * mining site rehabilitation; or


    (d) for purposes that include one or more of those purposes.

    40-755(4)    
    If * your earning activity is:


    (a) leasing a site you own; or


    (b) granting a *right to use a site you own or control; or


    (c) a similar activity involving a site;

    that site is taken to be the site of your earning activity.

    Note:

    This means you can deduct your expenditure on environmental protection activities relating to the site, even if the pollution or waste is caused by another entity that uses the site.



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