Taxation Ruling
IT 81W - Notice of Withdrawal
Income tax: trading stock: hire and rental business
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Please note that the PDF version is the authorised version of this withdrawal notice.
Notice of Withdrawal
Taxation Ruling IT 81 is withdrawn with effect from today.
1. The provisions to which Taxation Ruling IT 81 refers were repealed by the Tax Laws Amendment (Repeal of Inoperative Provisions) Act 2006.
2. Taxation Ruling IT 81 addressed the question of whether stocks held by a hire and rental business could be regarded as trading stock for purposes of the Income Tax Assessment Act 1936 and whether a percentage of stock on hand at the end of the income year could be regarded as trading stock, based on expected sales of hire or rental items.
3. Division 70 of the Income Tax Assessment Act 1997 (ITAA 1997) expressly provides for assets already owned by a business that start to be held as trading stock (section 70-30 of the ITAA 1997). In the current law it is clear that this provision is to be applied on an item-by-item basis.
4. Taxation Ruling IT 81 has no application to income tax years after 1997-98.
Commissioner of Taxation
30 March 2011