Income Tax Assessment Act 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-10 - CAPITAL ALLOWANCES: RULES ABOUT DEDUCTIBILITY OF CAPITAL EXPENDITURE  

Division 41 - Additional deduction for certain new business investment  

Operative provisions  

SECTION 41-25   Investment commitment time  

41-25(1)    

The investment commitment time for the amount is:

(a) if the amount is included in the first element of the asset's *cost - the time at which you:

(i) enter into a contract under which you *hold the asset at that time, or will hold the asset at a later time; or

(ii) start to construct the asset; or

(iii) start to hold the asset in some other way; or

(b) if the amount is included in the second element of the asset's cost - the time at which you enter into a contract, or start construction, for the economic benefit in relation to which the amount becomes, or will become, included in that element under paragraph 40-190(2)(a) .

Integrity rule

41-25(2)    

Subsection (3) applies in relation to an amount if:

(a) at a time, you:

(i) enter into a contract under which you *hold an asset at that time, or will hold the asset at a later time; or

(ii) start to construct an asset; or

(iii) start to hold an asset in some other way; and

(b) at a later time, you engage in conduct that results in you:

(i) entering into a contract under which you hold the asset mentioned in paragraph (a) (or an identical or substantially similar asset) at that later time, or will hold that asset (or an identical or substantially similar asset) at an even later time; or

(ii) starting to construct an asset that is identical or substantially similar to the asset mentioned in paragraph (a); or

(iii) starting to hold the asset mentioned in paragraph (a) (or an identical or substantially similar asset) in some other way; and

(c) you engage in that conduct for the purpose, or for purposes that include the purpose, of becoming entitled to a deduction under this Division.

41-25(3)    
Despite paragraph (1)(a), the investment commitment time for an amount to which that paragraph would otherwise apply is the time mentioned in paragraph (2)(a).

41-25(3A)    
For the purposes of paragraph (1)(a) and subsection (2), treat yourself as having started to construct an asset at a time if you first incur expenditure in respect of the construction of the asset at that time.

41-25(3B)    
For the purposes of paragraph (1)(b), treat yourself as having started construction for an economic benefit at a time if you first incur expenditure in respect of the construction for the benefit at that time.

Options

41-25(4)    
To avoid doubt, for the purposes of this section, you do not enter into a contract under which you *hold an asset merely because you acquire an option to enter into such a contract.