INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 328 - Small business entities  

Subdivision 328-D - Capital allowances for small business entities  

Operative provisions

SECTION 328-210   Low pool value  

328-210(1)  


Your deduction for a *general small business pool for an income year is the amount worked out under subsection (2) (instead of an amount calculated under section 328-190 ) if that amount is less than $1,000 but more than zero.
Note 1:

See section 328-215 for the result when the amount is less than zero.

Note 2:

This threshold is $20,000, $25,000 or $30,000 for income years ending on or after 12 May 2015 and on or before 30 June 2020: see subsection 328-180(6) of the Income Tax (Transitional Provisions) Act 1997 .

328-210(2)  


The amount is the sum of:


(a) the pool ' s *opening pool balance for the income year; and


(b) the *taxable purpose proportion of the *adjustable value of each *depreciating asset you started to use, or have *installed ready for use, for a *taxable purpose during the income year and that is allocated to the pool; and


(c) the taxable purpose proportion of any cost addition amounts (see subsection 328-190(3) ) for the income year for assets allocated to the pool;

less the sum of the taxable purpose proportion of the *termination values of depreciating assets allocated to the pool and for which a *balancing adjustment event occurred during the income year.

328-210(3)  


In that case, the * closing pool balance of the pool for that income year then becomes zero.
Example:

Amanda ' s Graphics is a small business entity for the 2014-15 income year and chooses to use this Subdivision for that year. The business has an opening pool balance of $8,500 for its general small business pool for that year.

During that year, Amanda acquired a new computer for $2,000. The taxable purpose proportion of its adjustable value is:

$2,000 × 80% business use estimate = $1,600

Amanda also sold her business car for $9,600 during that year. The car was used 100% in the business.

To work out whether she can deduct an amount under this section, Amanda uses this calculation:

$8,500 + $1,600 - $9,600 = $500

Because the result is less than $1,000, Amanda can deduct the $500 for the income year. The pool ' s closing balance for the year is zero.


 

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