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Edited version of private advice
Authorisation Number: 1051903837155
Date of advice: 30 September 2021
Ruling
Subject: Deduction - business airplane
Question 1
Are you entitled to claim a deduction under the Income Tax Assessment Act 1997 for the costs of acquiring a business airplane?
Answer
Yes, you are entitled to claim a deduction for the business portion of the costs of acquiring a business plane under the Income Tax Assessment Act 1997
Question 2
Are you entitled to claim a deduction under section 8-1 of the Income Tax Assessment Act 1997 for ongoing expenditure in relation to the business airplane?
Answer
Yes, you are entitled to claim a deduction for the business portion under section 8-1 of the Income Tax Assessment Act 1997.
Question 3
Are you entitled to fully write-off the business airplane under the current full expensing provisions?
Answer
Yes, if the business airplane is first held, first used or installed ready for use prior to 30 June 2022 you are entitled to full expensing to the extent of business usage. You must reduced your deduction by the extent to which the asset is used for a non-taxable purpose (for example, private use).
This ruling applies for the following period:
30 June 20XX
The scheme commences on:
1 June 20XX
Relevant facts and circumstances
You operate a business through presentations, talks and speeches within Australia and overseas.
You have an aggregated turnover of less than $X billion.
You are unable to fly on commercial planes due to health conditions and being at high risk if exposed to COVID-19.
You are a qualified pilot.
You purchased an airplane on X XXX 20XX for $XX,XXX.
The airplane is currently undergoing refurbishments and the airplane will be ready for taxable use around XXX or XXX 20XX.
The yearly estimated running costs of the airplane is $XX,XXX.
Under Civil Aviation Safety Authority (CASA) requirements a logbook is required to be kept for both the pilot and airplane which will also be used to determine your business and personal usage of the airplane.
The airplane will be located in Australia and will only be used for travel within Australia.
You anticipate that majority of your airplane usage will be for business purposes.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1
Income Tax Assessment Act 1997 Division 40
Income Tax Assessment Act 1997 Subdivision 328-C
Income Tax Assessment Act 1997 Subdivision 328-D
Income Tax (Transition Provisions) Act 1997 Subdivision 40-BB
Income Tax (Transition Provisions) Act 1997 Section 328-181