INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 10F - Deduction for capital expenditure incurred in establishing horticultural plants  

Subdivision E - Effective lives of plants  

SECTION 124ZZK   WHAT IS THE EFFECTIVE LIFE OF A PLANT?  

124ZZK(1)   [Effective life depends on election by original taxpayer]  

For the purposes of this Division, the effective life of a plant depends on whether the original taxpayer elects to adopt the period specified in the Commissioner's determination under section 124ZZL . For this purpose, an entity is the original taxpayer in relation to a plant if the entity owned the plant at the time when the plant first became capable of being used:

(a) for the purpose of producing assessable income; and

(b) in a business of horticulture.

Note:

Under section 124ZZL , the Commissioner may make a determination specifying periods that taxpayers may elect to adopt as the effective lives of horticultural plants owned by them.

124ZZK(2)   Original taxpayer may elect to adopt the period specified in the Commissioner's determination.  

If:

(a) there is in force a determination by the Commissioner under section 124ZZL which specifies a period that a taxpayer may elect to adopt as the effective life of the plant; and

(b) the original taxpayer makes a written election to adopt that period;

the effective life of the plant is that period.

124ZZK(3)   Effective life if original taxpayer does not elect to adopt the period specified in the Commissioner's determination.  

If the original taxpayer does not elect to adopt the period specified in the Commissioner's determination, the effective life of the plant is the period, worked out as at the time when the plant first became capable of being used:

(a) for the purpose of producing assessable income; and

(b) in a business of horticulture;

during which it would be reasonable to expect that the plant would be capable of being used:

(c) for the purpose of producing assessable income; and

(d) in a business of horticulture.

124ZZK(4)   Election is irrevocable.  

An election under this section is irrevocable.