Items are identical if they are the same in all respects. Items are substantially identical if they are the same in most respects even though there may be some minor or incidental differences. Factors you would consider include colour, shape, function, texture, composition, brand and design.
You do not take assets into account that you acquired in another income year.
Example: Substantially identical items (ignoring any GST impact)
Jan buys three kitchen stools for her rental property in the 2002–03 income year. The stools are all wooden and of the same design, however, they are different colours. The colour of the stools is only a minor difference which is not enough to conclude that the stools are not substantially identical.
The stools cost $150 each. Jan cannot claim an immediate deduction for the cost of each individual stool because they are substantially identical and their total cost exceeds $300.
End of example