INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 3 - Deductions  

Subdivision F - Substantiation of certain expenses of years of income up to and including 1993-94  

SECTION 82KY   ELECTIONS  

82KY(1)   [Manner of election]  

An election by a taxpayer under this SubDivision must be made on or before the date of lodgment of the return of income of the taxpayer for the year of income to which the election relates, or before such later date as the Commissioner allows.

82KY(2)   [Allowable deduction where no election made]  

Where:

(a) apart from this subsection, a taxpayer has not elected that subsection 82KW(2) or (3) or 82KX(1) apply in relation to a car in relation to a year of income; and

(b) whichever of the following amounts is the greatest:

(i) the sum of the deductions that would have been allowable under this Act to the taxpayer in respect of car expenses relating to the car incurred by the taxpayer in the year of income if the taxpayer had made an election that subsection 82KW(2) apply in relation to the car in relation to the year of income;

(ii) the deduction that would have been allowable to the taxpayer in relation to the car in relation to the year of income if the taxpayer had elected that subsection 82KW(3) apply in relation to the car in relation to the year of income;

(iii) the deduction that would have been allowable to the taxpayer in relation to the car in relation to the year of income if the taxpayer had elected that subsection 82KX(1) apply in relation to the car in relation to the year of income;

exceeds the sum of the deductions allowable to the taxpayer under this Act in respect of car expenses relating to the car incurred by the taxpayer in the year of income and ascertained under section 82KUD ;

this Subdivision (other than the definition of log book car in subsection 82KT(1) and section 82KTG ) applies, and shall be deemed always to have applied, as if the election referred to in whichever of subparagraphs (b)(i), (ii) or (iii) is applicable had been made by the taxpayer in relation to the car in relation to the year of income.

82KY(3)   [Deduction allowable under log book method]  

For the purposes of subsection (2), where a deduction is not allowable to the taxpayer under this Act in respect of car expenses relating to a car incurred by the taxpayer in the year of income because of a failure to comply with section 82KUB or 82KUC , the sum of those deductions shall be taken to be a nil amount.

82KY(4)   [Expenses incurred by taxpayer]  

A taxpayer is not entitled to elect that subsection 82KW(3) or 82KX (1) apply in relation to a car in relation to a year of income unless the taxpayer has incurred so much of each car expense that relates to the car and is incurred during the year of income (other than an expense that it would be unreasonable to expect the taxpayer to have incurred) as is attributable to a period during which the car was used by the taxpayer.

82KY(5)   [Expenditure brought forward]  

Where -

(a) a taxpayer elects that subsection 82KW(3) or 82KX (1) apply in relation to a car in relation to a year of income; and

(b) in the opinion of the Commissioner, it is reasonable to conclude that a car expense that relates to the car and was incurred by the taxpayer during a year of income commencing before 1 July 1986 would, if this Subdivision had not been enacted, have been incurred by the taxpayer during the year of income referred to in paragraph (a),

a deduction is not allowable, and shall be deemed never to have been allowable, to the taxpayer under this Act in respect of the car expense.

82KY(6)   [Car disposed of, lost or destroyed]  

Where -

(a) depreciation in respect of a car has been allowed, or is allowable, as a deduction to a taxpayer in respect of a period, or in respect of each of 2 or more periods;

(b) the taxpayer has elected in a relevant manner in relation to the car in relation to a year of income or in relation to each of 2 or more years of income; and

(c) at a particular time (in this subsection referred to as the relevant time ), the car is disposed of, lost or destroyed,

then -

(d) for the purposes of section 59 , the depreciated value of the car at the relevant time shall be deemed to be the amount (in this subsection referred to as the notional amount ) that, in the opinion of the Commissioner, would have been the amount of the depreciated value of the car at the relevant time if the taxpayer had not elected in a relevant manner in relation to the car in relation to, and this Subdivision did not apply, and had never applied, in relation to depreciation in respect of the car in respect of, the year of income, or any of the years of income, referred to in paragraph (b);

(e) in applying section 56 for the purpose of ascertaining the notional amount, the use of the car by the taxpayer during the year of income, or during any of the years of income, referred to in paragraph (b) shall be deemed to have been for the purpose of producing assessable income of the taxpayer;

(f) in applying section 61 for the purpose of ascertaining the notional amount, the use of the car by the taxpayer during the year of income, or during any of the years of income, referred to in paragraph (b) shall be deemed to have been -

(i) if the taxpayer elected that subsection 82KW(3) apply in relation to the car in relation to the year of income concerned - to the extent of 33 ⅓ %; or

(ii) if the taxpayer elected that subsection 82KX(1) apply in relation to the car in relation to the year of income concerned - to the extent of 20%,

for the purpose of producing assessable income of the taxpayer; and

(g) the amount of the deduction allowable to, or the amount to be included in the assessable income of, the taxpayer under subsection 59(1) or (2) by reason of the disposal, loss or destruction of the car shall be such proportion (if any) of the amount that, but for this paragraph, would be the amount of the deduction so allowable or the amount to be so included as the Commissioner considers reasonable having regard to the proportion that the period, or the aggregate of the periods, referred to in paragraph (a) bears to the aggregate of -

(i) the period or periods referred to in paragraph (a); and

(ii) the year of income or years of income referred to in paragraph (b).

82KY(7)   [Election in relevant manner]  

For the purposes of subsection (6), a taxpayer who elects that subsection 82KW(3) or 82KX (1) apply in relation to a car in relation to a year of income shall be taken to elect in a relevant manner in relation to the car in relation to the year of income.