| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of private advice
Authorisation Number: 1012680287767
Ruling
Subject: Depreciation
Question
Are you entitled to a deduction for the full depreciable cost of your light commercial vehicle?
Answer
Yes.
This ruling applies for the following periods:
Year ended 30 June 2014
The scheme commenced on
1 July 2013
Relevant facts and circumstances
You purchased a six seater 2.5 to 2.7 tonnes load capacity light commercial vehicle.
You use this vehicle 100% for business purposes.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 8-1
Income Tax Assessment Act 1997 section 40-230
Income Tax Assessment Act 1997 section 995-1
Reasons for decision
Section 40-230 of the Income Tax Assessment Act 1997 (ITAA 1997) details when the car limit applies to a motor vehicle:
The first element of the cost of a car designed mainly for carrying passengers (after applying section 40-225 and Subdivision 27-B) is reduced to the car limit for the financial year in which you started to hold it if its cost exceeds that limit.
Car is defined in section 995-1 of the ITAA 1997 as:
motor vehicle (except a motor cycle or similar vehicle) that is designed to carry a load of less than 1 tonne and fewer than 9 passengers and motor vehicle is also defined in section 995-1 as any motor powered road vehicle (including a 4 wheel drive vehicle).
In your case, from the description provided, the motor vehicle you purchased is not a car for the purposes of section 40-230 of the ITAA 1997 and therefore the car limit does not apply when calculating depreciation for the motor vehicle.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
