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Edited version of private ruling
Authorisation Number: 1011794032686
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Ruling
Subject: Decline in value - audio equipment
Question
Are you entitled to a deduction for your half share of the cost of audio equipment?
Answer
Yes.
This ruling applies for the following period
Year ended 30 June 2011
The scheme commenced on
1 July 2010
Relevant facts
You and your spouse work from your home office as contractors for an overseas company. You each declare half of the income from the contract work.
You facilitate audio/video conferences in order to discuss work matters.
You purchased an item of audio equipment for between $200 and $300.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 40-25
Income Tax Assessment Act 1997 Subsection 40-80(2)
Reasons for decision
Section 40-25 of the Income Tax Assessment Act 1997 allows a deduction for an amount equal to the decline in value of a depreciating asset to the extent that it is used to produce assessable income.
You can deduct the asset's cost under subsection 40-80(2) if you use the asset predominantly for the purpose of producing assessable income and the cost does not exceed $300.
Therefore, as the cost of the equipment was less than $300 and are used predominantly for income producing purposes, you may claim your half share of the cost of the equipment.
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