Income Tax Assessment Act 1997
If you split a *depreciating asset into separate assets as mentioned in section 40-115 , the first element of the cost of each of the separate assets is a reasonable proportion of the sum of these amounts:
(a) the *adjustable value of the original asset just before it was split; and
(b) the amount you are taken to have paid under section 40-185 for any economic benefit involved in splitting the original asset.
Barry owns a spectrum licence that covers 3 areas: Area A, area B and area C. The licence has an adjustable value of $160,000. He sells area A to Chris, and his costs of splitting are $10,000. Barry is taken to have split the licence into 2 assets.
On the basis of their relative market values, Barry apportions $170,000 to area A (that he disposed of) and to the licence he still holds for areas B and C.