Working out decline in value

You work out deductions for the decline in value of most depreciating assets, including those acquired before 1 July 2001, under UCA.

UCA contain general rules for working out the decline in value of a depreciating asset, and those rules are covered in this part of the guide. Transitional rules apply to depreciating assets held before 1 July 2001 so you can work out their decline in value using these rules; see Depreciating assets held before 1 July 2001.

The general rules do not apply to some depreciating assets. UCA provide specific rules for working out deductions for the assets listed below:

• certain depreciating assets that cost $300 or less and that are used mainly to produce non-business assessable income; see Immediate deduction for certain non-business depreciating assets (costing $300 or less)
• assets that cost less than the Instant asset write-off threshold
• assets that may be eligible for the Backing Business Investment measure; see Backing business investment
• certain depreciating assets that may be eligible for Temporary full expensing
• certain depreciating assets that cost or are written down to less than $1,000; see Low-value pools
• in-house software for which expenditure has been allocated to a software development pool; see Software development pools
• depreciating assets used in exploration or prospecting; see Mining and quarrying, and minerals transport
• water facilities, fencing assets, fodder storage assets and horticultural plants (including grapevines); see Primary production depreciating assets
• certain depreciating assets of primary producers, other landholders and rural land irrigation water providers used in landcare operations; see Landcare operations
• certain depreciating assets of primary producers and other landholders used for electricity connections or phone lines; see Electricity connections and phone lines
• trees in a carbon sink forest; see Carbon sink forests.

There are also specific rules for working out notional deductions for depreciating assets used in carrying on research and development activities; see Research and development tax incentive schedule instructions 2021 (NAT 6709).

When does a depreciating asset start to decline in value?

The decline in value of a depreciating asset starts when you first use it, or install it ready for use, for any purpose, including a private purpose. This is known as a depreciating asset’s start time.

Although an asset is treated as declining in value from its start time, a deduction for its decline in value is only allowable to the extent it is used for a taxable purpose; see Definitions.

If you initially use a depreciating asset for a non-taxable purpose, such as for a private purpose, and in later years use it for a taxable purpose, you need to work out the asset’s decline in value from its start time, including the years you used it for a private purpose. You can then work out your deductions for the decline in value of the asset for the years you used it for a taxable purpose; see Decline in value of a depreciating asset used for a non-taxable purpose.

New accelerated depreciation measures

Measures introduced in March 2020 provide an incentive for businesses with aggregated turnover of less than $500 million to deduct the cost of depreciating assets at an accelerated rate in 2019-20 and 2020–21. See Backing business investment.

Measures introduced in October 2020 provide further incentive for businesses with an aggregated turnover of less than $5 billion (or corporate tax entities satisfying the alternative test) to deduct the full cost of eligible depreciating assets if they are first held and first used, or installed ready for use, by them for a taxable purpose from 7:30 pm (AEDT) on 6 October 2020 to 30 June 2022. Businesses are also able to deduct the full cost of improvements to these new or existing eligible depreciating assets made during this period. For information about which new accelerated depreciation measure applies to an asset, see Interaction of tax depreciation incentives.

Temporary full expensing of depreciating assets

Businesses with an aggregated turnover of less than $5 billion (or corporate tax entities satisfying the alternative test), can immediately deduct the business portion of the cost of eligible new depreciating assets of any value. The eligible new assets must be first held, and first used or installed ready for use for a taxable purpose, between 7:30 pm AEDT on 6 October 2020 and 30 June 2022.

Businesses can also immediately deduct the business portion of the cost of improvements to eligible depreciating assets (and to assets acquired before 7.30 pm AEDT on 6 October 2020 that would otherwise be eligible assets) if those costs are incurred between 7:30 pm AEDT on 6 October 2020 and 30 June 2022.

Generally, to be eligible for the temporary full expensing incentive, a depreciating asset must be:

• first held, and first used or installed ready for use, for a taxable purpose, between 7:30 pm (AEDT) on 6 October 2020 and 30 June 2022;
• located in Australia and principally used in Australia for the principal purpose of carrying on a business; and
• not have a balancing adjustment event happen in the same income year.

Additionally, the depreciating asset:

• must not be excluded from the uniform capital allowance rules in Division 40 of the ITAA 1997 (such as a building or other capital works); or
• must not be subject to the capital allowance rules of the ITAA 1997
  • in Subdivision 40-E (about low value and software development pools), or
  • in Subdivision 40-F (about primary production depreciating assets).
   

If your business has an aggregated turnover of $50 million or more, you are excluded from immediately deducting the cost of an eligible asset that is:

• an asset you entered into a commitment to hold, construct or use before 7:30 pm AEDT on 6 October 2020; or
• a second-hand asset.

The car limit applies to limit the temporary full expensing deduction where a car is designed to mainly carry passengers.

If you start to hold an eligible asset and you first use the asset, or have it installed ready for use, for a taxable purpose in the same income year, you deduct in the income year the sum of:

• the asset’s cost and
• the costs of improvements incurred in the income year.

If you only start to use the asset, or have it installed ready for use, for a taxable purpose in an income year that is later than the year when you started to hold the asset, you deduct in that later income year the sum of:

• the asset’s opening adjustable value for that later income year, and
• the costs of improvements incurred in that later income year.

Small business entities that choose to use the simplified depreciation rules in an income year ending between 6 October 2020 and 30 June 2022, must apply temporary full expensing. However, if you do not want to apply temporary full expensing, you will need to opt out of the simplified depreciation rules during this period. However, you must still deduct the balance of your small business pool in the year you choose to opt out of the simplified depreciation rules.

For other entities that do not use the simplified depreciation rules, if an asset qualifies for an immediate deduction under temporary full expensing in an income year, you can make a choice to opt-out of temporary full expensing on an asset-by-asset basis for a particular income year. However, you must notify us in an approved form (such as using the new items on the tax return form) that you have chosen not to apply temporary full expensing to the asset for an applicable income year. The choice is irrevocable and you must notify us by the day you lodge your income tax return for the income year to which the choice relates. Once you have lodged your return, you will not be able to opt-out of temporary full expensing.

For further information on eligible assets and eligible businesses, see Temporary full expensing.

Instant asset write-off

Under the instant asset write-off, eligible businesses (not individual taxpayers) can claim an immediate deduction for the business portion of the cost of an asset in the year the asset is first used or installed ready for use.

Eligibility to use instant asset write-off on an asset depends on:

• your aggregated turnover (the total ordinary income of your business and that of associated businesses)
• the date you purchased the asset
• the date the asset was first used or installed ready for use
• the cost of the asset being less than the relevant limit.

For assets you start to hold, and first use (or have installed ready for use) for a taxable purpose from 7:30 pm (AEDT) on 6 October 2020 to 30 June 2022, the instant asset write-off threshold does not apply. You can immediately deduct the business portion of the asset's cost under temporary full expensing.

If you are a small business, you will need to apply the simplified depreciation rules in order to claim the instant asset write-off. It cannot be used for assets that are excluded from those rules.

Thresholds

The thresholds have changed over recent years.

Instant asset write-off thresholds for small businesses that apply the simplified depreciation rules

Eligible businesses	Date range for when asset first used or installed ready for use	Threshold $
Less than $10 million aggregated turnover	12 March 2020 to 30 June 2021, providing the asset is purchased by 31 December 2020 see Note 1	150,000
Less than $10 million aggregated turnover	7:30 pm (AEDT) on 2 April 2019 to 11 March 2020	30,000
Less than $10 million aggregated turnover	29 January 2019 to prior to 7:30 pm (AEDT) on 2 April 2019	25,000
Less than $10 million aggregated turnover	1 July 2016 to 28 January 2019	20,000
Less than $2 million aggregated turnover	7:30 pm (AEST) on 12 May 2015 to 30 June 2016	20,000
Less than $2 million aggregated turnover	1 January 2014 to prior to 7:30 pm (AEST) 12 May 2015	1,000
Less than $2 million aggregated turnover	1 July 2012 to 31 December 2013	6,500
Less than $2 million aggregated turnover	1 July 2011 to 30 June 2012	1,000

Note 1: You must have purchased the asset on or after 7:30 pm (AEST) on 12 May 2015.

Instant asset write-off thresholds for businesses with an aggregated turnover of $10 million or more but less than $500 million

Eligible businesses	Date range for when asset first used or installed ready for use	Threshold $
Less than $500 million aggregated turnover	12 March 2020 to 30 June 2021 providing the asset is purchased by 31 December 2020	150,000
Less than $50 million aggregated turnover	7:30 pm (AEDT) on 2 April 2019 to 11 March 2020 see Note 2	30,000

Note 2: You must have purchased the asset on or after 7 30 pm (AEST) on 2 April 2019.

For further information see Instant asset write-off for eligible businesses.

The car limit applies to limit the instant asset write off deduction where a car is designed to mainly carry passengers.

For assets purchased costing more than the relevant threshold, backing business investment may apply or the general depreciation rules must be used.

Backing business investment

Measures introduced in March 2020 provide an incentive for businesses with aggregated turnover of less than $500 million to deduct the cost of depreciating assets at an accelerated rate in 2019–20 and 2020–21.

To be eligible to apply the accelerated rate of deduction, the depreciating asset must:

• be new and not previously held by another entity (other than as trading stock or for testing and trialling purposes)
• be first held on or after 12 March 2020
• be first used, or first installed ready for use, for a taxable purpose on or after 12 March 2020 to 30 June 2021 inclusive
• not be an asset to which an entity has used temporary full expensing or instant asset write-off for the same asset.

If your aggregated turnover is less than $500 million in 2020–21 and you do not use the simplified depreciation rules, the amount you can deduct in the income year the asset is first used, or installed ready for use, is:

• 50% of the cost (or adjustable value where applicable) of the depreciating asset, plus
• the amount of the usual depreciation deduction that would otherwise apply on the remaining 50% of the cost of the depreciating asset.

If you are eligible for backing business investment – accelerated depreciation, you can choose to not apply these rules to an asset. The choice can be made on an asset-by-asset basis but cannot be changed once made. You must:

• make the choice in your tax return
• notify us by the day you lodge your tax return for the income year to which the choice relates.

If you are small business using the simplified depreciation rules you must apply backing business investment – accelerated depreciation if you are eligible.

If you are a small business with an aggregated turnover less than $10 million, and you use the simplified depreciation rules, you add to your general small business pool assets that:

• cost $150,000 or more (instant asset write-off applies to assets costing less than this)
• are eligible for backing business investment – accelerated depreciation
• are not eligible for temporary full expensing.

You then deduct an amount equal to 57.5% (rather than 15%) of the business portion of a new depreciating asset in the year you add it to the pool. In later years the asset will be depreciated under the general small business pool rules.

See also:

• Backing business investment – accelerated depreciation

Methods of working out decline in value

You generally have the choice of two methods to work out the decline in value of a depreciating asset. These are:

• the prime cost method
• the diminishing value method.

Both these methods are based on a depreciating asset’s effective life. The rules for working out an asset’s effective life are explained in Effective life of a depreciating asset.

You can generally choose to use either method for each depreciating asset you hold. However, once you have chosen a method for a particular asset, you cannot change to the other method for that asset.

The Depreciation and capital allowances tool will help you with the choice and the calculations.

If you were carrying on a business in 2020–21, there are additional methods that might apply to you. Depending on your aggregated turnover, whether you are applying the simplified depreciation rules, and when you start to use the deprecating asset, you may have the option of using Temporary full expensing or Instant asset write off or Backing business investment – accelerated depreciation.

If you are not carrying on a business, you may be able to claim an immediate deduction for certain depreciating assets that cost $300 or less; see Immediate deduction for certain non-business depreciating assets (costing $300 or less).

In other cases, you do not have a choice of which method you use to work out the decline in value. These cases are:

• If you acquire intangible depreciating assets such as in-house software, certain items of intellectual property, spectrum licences, datacasting transmitter licences and telecommunications site access rights, you must use the prime cost method.
• If you acquire a depreciating asset from an associate who has deducted or can deduct amounts for the decline in value of the asset, see Depreciating asset acquired from an associate.
• If you acquire a depreciating asset, but the user of the asset does not change or is an associate of the former user, for example, under sale and leaseback arrangements, see Sale and leaseback arrangements.

If there has been rollover relief, see Rollover relief.

If the asset has been allocated to a low-value pool or software development pool, the decline in value is calculated at a statutory rate, see Software development pools and Low-value pools.

By working out the decline in value you determine the adjustable value of a depreciating asset. A depreciating asset’s adjustable value at a particular time is its cost (first and second elements) less any decline in value up to that time. See The cost of a depreciating asset for information on first and second elements of cost. The opening adjustable value of an asset for an income year is generally the same as its adjustable value at the end of the previous income year.

You calculate the decline in value and adjustable value of a depreciating asset from the asset’s start time independently of your use of the depreciating asset for a taxable purpose. However, your deduction for the decline in value is reduced by the extent that your use of the asset is for a non-taxable purpose; see Decline in value of a depreciating asset used for a non-taxable purpose. Your deduction may also be reduced if the depreciating asset is a leisure facility or boat even though the asset is used, or installed ready for use, for a taxable purpose; see Decline in value of leisure facilities and Decline in value of boats.

The diminishing value method

The diminishing value method:

• assumes the decline in value each income year is a constant percentage of the base value each year for the effective life of the asset, and therefore,
• produces a progressively smaller decline in the item’s value over time.

Did you hold the depreciating asset before 10 May 2006?

Yes: For depreciating assets you held before 10 May 2006, the formula for
the decline in value is:

base value × (days held ÷ 365) × (150% ÷ asset's effective life)

Use this formula for any asset you held before 10 May 2006, even if you
disposed of it and reacquired it on or after 10 May 2006.

No: For depreciating assets you started to hold on or after 10 May 2006, the formula for the decline in value is:

base value × (days held ÷ 365) × (200% ÷ asset's effective life).

The base value:

• for the income year in which an asset’s start time occurs, is the asset’s cost
• for a later income year, is    
  • the asset’s opening adjustable value for that year, plus
  • any amount included in the asset’s second element of cost for that year.
   

Days held is the number of days you held the asset in the income year in which:

• you used it, or
• you had it installed ready for use for any purpose.

Days held:

• can be 366 for a leap year, even though the denominator remains 365
• is the number of days you held the asset during the income year    
  • from its starting date in the income year in which the asset’s start occurs
  • until its ending date in the income year in which the asset’s end-of-life occurs.
   

For information about balancing adjustment events, see What happens if you no longer hold or use a depreciating asset?.

You cannot use the diminishing value method to work out the decline in value of:

• in-house software
• an item of intellectual property (except copyright in a film)
• a spectrum licence
• a datacasting transmitter licence, or
• a telecommunications site access right.

 

The prime cost method

The prime cost method:

• assumes the value of a depreciating asset decreases constantly over its effective life, and therefore,
• produces a consistent decline in the item’s value over time.

The formula for the annual decline in value using the prime cost method is:

asset's cost × (days held ÷ 365) × (100% ÷ asset's effective life)

The value of the asset's cost decreases every year by a constant amount. That constant amount is the actual cost divided by the number of years of effective life. In the first year, the value of the asset's cost is the actual cost of the asset.

• If your asset cost $2,000 and has an effective life of five years, you can claim one fifth, 20%, of its cost, that is $400, in each of the five years.

Days held is the number of days you held the asset in the income year in which:

• you used it, or
• you had it installed ready for use for any purpose.

Days held:

• can be 366 for a leap year, even though the denominator remains 365
• is the number of days you held the asset during the income year    
  • from its starting date in the income year in which the asset’s start occurs
  • until its ending date in the income year in which the asset’s end-of-life occurs.
   

For information about balancing adjustment events, such as the start and end dates, see What happens if you no longer hold or use a depreciating asset?

If there has been rollover relief and the transferor used the prime cost method to work out the asset’s decline in value, the transferee should replace the asset’s effective life in the prime cost formula with the asset’s remaining effective life, that is, any period of the asset’s effective life that is yet to elapse when the transferor stopped holding the asset; see Rollover relief.

An adjusted prime cost formula must be used if any of the following occurs:

• you recalculate the effective life of an asset; see Effective life of a depreciating asset
• an amount is included in the second element of an asset’s cost in an income year after the initial income year in which the asset’s start time occurs; see The cost of a depreciating asset
• an asset’s opening adjustable value is reduced by a debt forgiveness amount; see Commercial debt forgiveness
• you reduced the opening adjustable value of a depreciating asset that is the replacement asset for an asset subject to an involuntary disposal; see Involuntary disposal of a depreciating asset
• an asset’s opening adjustable value is modified due to GST increasing or decreasing adjustments, input tax credits for the acquisition or importation of the asset, or input tax credits for amounts included in the second element of cost of an asset; see GST input tax credits, or
• an asset’s opening adjustable value is modified due to forex realisation gains or forex realisation losses; see Foreign currency gains and losses.

You must use the adjusted prime cost formula for the income year in which any of these changes are made (the ‘change year’) and later years. Where the asset's remaining effective life is any period of its effective life that is yet to elapse either at the start of the change year or, in the case of roll-over relief, when the balancing adjustment even occurs for the transferor, the formula for the decline in value is:

opening adjustable value for the change year plus any second element cost amounts for that year x (days held ÷ 365) x (100% ÷ asset's remaining effective life)

The prime cost formula must also be adjusted for certain intangible depreciating assets you acquire from a former holder; see Effective life of intangible depreciating assets.

Depreciating assets held before 1 July 2001

To work out the decline in value of depreciating assets you held before 1 July 2001, you generally use the same cost, effective life and method that you were using under the former law.

The undeducted cost of the asset at 30 June 2001 becomes its opening adjustable value at 1 July 2001.

You work out the undeducted cost of the asset under the former depreciation rules. It is the asset’s cost less the depreciation for the asset up to 30 June 2001, assuming that you used it wholly for producing assessable income.

For a spectrum licence, a depreciating asset that is an item of intellectual property and certain depreciating assets used in mining, quarrying or minerals transport, the opening adjustable value at 1 July 2001 is the amount of unrecouped expenditure for the asset at 30 June 2001. These assets do not have an undeducted cost under the former rules.

Special transitional rules apply to plant for which you used accelerated rates of depreciation before 1 July 2001 or could have used accelerated rates had you used the plant, or had it installed ready for use, for producing assessable income before that day. These rules ensure that accelerated rates continue to apply under UCA.

Decline in value of a depreciating asset used for a non-taxable purpose

You calculate the decline in value and adjustable value of a depreciating asset from the start time independently of your use of the depreciating asset for a taxable purpose. However, you reduce your deduction for the decline in value by the extent that your use of the asset is for a non-taxable purpose.

If you initially use an asset for a non-taxable purpose, such as for a private purpose, and in later years use it for a taxable purpose, you need to work out the asset’s decline in value from its start time including the years you used it for a private purpose. You can then work out your deductions for the decline in value of the asset for the years you used it for a taxable purpose.

 

Decline in value of leisure facilities

Your deduction for the decline in value of a leisure facility may be reduced even though you use it, or install it ready for use, for a taxable purpose. Your deduction is limited to the extent that:

• the asset’s use is a fringe benefit, or
• the leisure facility is used (or held for use) mainly in the ordinary course of your business of providing leisure facilities for payment, to produce your assessable income in the nature of rents or similar charges, or for your employees’ use or the care of their children.

Decline in value of boats

The total amount you can claim as a deduction for the decline in value of a boat that you use or hold cannot exceed your assessable income from using or holding that boat in 2020–21. If the total amount of your deduction exceeds the relevant assessable income, we reduce the deduction by the amount of the excess.

Exceptions to that reduction are:

• holding a boat as your trading stock
• using a boat (or holding it) mainly for letting it on hire in the ordinary course of a business that you carry on
• using a boat (or holding it) mainly for transporting the public or goods for payment in the ordinary course of a business that you carry on, or
• using a boat for a purpose that is essential to the efficient conduct of a business that you carry on.

Depreciating asset acquired from an associate

If you acquired plant on or after 9 May 2001 or another depreciating asset on or after 1 July 2001 from an associate, such as a relative or partner, and the associate claimed or can claim deductions for the decline in value of the asset, you must use the same method of working out the decline in value that the associate used.

If the associate used the diminishing value method, you must use the same effective life that they used. If they used the prime cost method you must use any remaining period of the effective life used by them.

You must recalculate the effective life of the depreciating asset if the asset’s cost increases by 10% or more in any income year, including the year in which you start to hold it; see How to recalculate effective life.

You can require the associate to tell you the method and effective life they used by serving a notice on them within 60 days after you acquire the asset. Penalties can be imposed if the associate intentionally refuses or fails to comply with the notice.

Sale and leaseback arrangements

If you acquired plant on or after 9 May 2001 or another depreciating asset after 1 July 2001 but the user of the asset does not change or is an associate of the former user, such as under a sale and leaseback arrangement, you must use the same method of working out the decline in value that the former holder used.

If the former holder used the diminishing value method, you must use the effective life that they used. If they used the prime cost method, you must use any remaining period of the effective life used by them. If you cannot readily ascertain the method that the former holder used or if they did not use a method, you must use the diminishing value method. You must use an effective life determined by the Commissioner if you cannot find out the effective life that the former holder used or if they did not use an effective life.

You must recalculate the effective life of the depreciating asset if the asset’s cost increases by 10% or more in any income year, including the year in which you start to hold it; see How to recalculate effective life.

Immediate deduction for certain non-business depreciating assets (costing $300 or less)

The decline in value of certain depreciating assets costing $300 or less is their cost. This means you get an immediate deduction for the cost of the asset to the extent that you used it for a taxable purpose during the income year in which the deduction is available.

The immediate deduction is available if all of the following tests are met for the asset:

• it cost $300 or less; see Cost is $300 or less
• you used it mainly for the purpose of producing assessable income that was not income from carrying on a business; see Used mainly to produce non-business assessable income
• it was not part of a set of assets you started to hold in the income year that cost more than $300; see Not part of a set, and
• it was not one of a number of identical or substantially identical assets you started to hold in the income year that together cost more than $300; see Not one of a number of identical or substantially identical items.

If you are not eligible to claim the immediate deduction, you work out the decline in value of the asset using the general rules for working out decline in value. Alternatively, you may be able to allocate the asset to a low-value pool; see Low-value pools.

This immediate deduction is not available for the following depreciating assets:

• certain water facilities, fencing assets, fodder storage assets and horticultural plants, including grapevines; see Primary production depreciating assets
• certain depreciating assets of primary producers, other landholders and rural land irrigation water providers used in landcare operations; see Landcare operations
• certain depreciating assets of primary producers and other landholders used for electricity connections or phone lines; see Electricity connections and phone lines
• in-house software if you have allocated expenditure on it to a software development pool; see Software development pools.

The amount of the immediate deduction may need to be reduced if the changes which limit deductions for decline in value of certain second-hand depreciating assets in residential rental properties apply to the asset; see Second-hand depreciating assets in residential rental properties.

Cost is $300 or less

If you are entitled to a GST input tax credit for the asset, the cost is reduced by the input tax credit before determining whether the cost is $300 or less.

If you hold an asset jointly with others and the cost of your interest in the asset is $300 or less, you can claim the immediate deduction even though the depreciating asset in which you have an interest costs more than $300; see Jointly held depreciating assets.

Used mainly to produce non-business assessable income

Some examples of depreciating assets used to produce non-business income are:

• a briefcase or tools of trade used by an employee
• freestanding furniture in a residential rental property that was purchased as new after 9 May 2017 and had never been used previously
• a calculator used in managing an investment portfolio.

To claim the immediate deduction, you must use the depreciating asset more than 50% of the time for producing non-business assessable income.

If you meet this test, you can use the asset for other purposes (such as to carry on a business) and still claim the deduction. However, if you use the asset mainly for producing non-business assessable income but you also use the asset for a non-taxable purpose, then the amount of deduction must be reduced by the amount attributable to the use for a non-taxable purpose.

Not part of a set

You need to determine whether items form a set on a case-by-case basis. You can regard items as a set if they are:

• dependent on each other
• marketed as a set, or
• designed and intended to be used together.

It is the cost of a set of assets you acquire in the income year that must not exceed $300. You cannot avoid the test by buying parts of a set separately.

 

A group of assets acquired in an income year can be a set in themselves, even though they also form part of a larger set acquired over more than one income year. If the assets acquired in an income year are a set then the total cost of that set must not exceed $300. Assets acquired in another income year that form part of a larger set are not taken into account when working out the total cost of a set and whether items form a set.

The concept of a set requires more than one depreciating asset. In some cases, however, more than one item may be a single depreciating asset. An example would be a three volume dictionary. This is a single depreciating asset, not a set of three separate depreciating assets, as the three volumes have a single integrated function.

Not one of a number of identical or substantially identical items

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 to consider include colour, shape, function, texture, composition, brand and design.

The total cost of the asset and any other identical or substantially identical asset that you acquired in the income year must not exceed $300. Do not take into account assets that you acquired in another income year.