2014/15 140, /14 136,884

Transcription

1 CGT Improvement Thresholds Certain improvements to pre-cgt assets will be deemed to be separate post-cgt assets where the cost base of the improvement exceeds both the improvement threshold for the year and 5 of the consideration for the sale of the asset. Income Year Improvement Threshold 2014/15 140, /14 136,884 CGT Indexation Factors Indexation (based on movements in the Consumer Price Index or CPI) is only relevant in working out the cost base of an asset acquired on or before 11.45am 21 September Changes to the tax law mean that indexation is frozen to the September 1999 quarter. However, the CPI rates are reported in the table below because they are relevant to some provisions in tax and superannuation law including, among other things, calculating the taxable value of a fringe benefit relating to the repurchase of remote area residential property. 1 Year Quarter Ending Quarter Ending Quarter Ending Quarter Ending 31 March 30 June 30 September 31 December Not available Not available Not available

2 Voice Year Quarter Ending Quarter Ending Quarter Ending Quarter Ending 31 March 30 June 30 September 31 December Note that the Australian Bureau of Statistics changed the index reference base in September 2012 from 1989/90 to 2011/12. As a result all CPI rates have been reset and the previous rates no longer apply. The rates reported in the above table are the reset rates. Valuation of Natural Increase Prescribed Cost Rates 2014/15 Description Rate per Head Rate per Head Description Cattle Horses Deer Pigs Emus 8.00 Poultry 0.35 Goats 4.00 Sheep Where a service fee is incurred for insemination and a horse is acquired as a result, its cost is the greater of the cost (i.e., actual or as prescribed by the regulations) and the amount of the service fee attributable to the acquisition. Goods Taken from Stock for Private Use Type of Business Adult/Child 2 Over 16 years 2014/15 Child years Bakery 1, Butcher Restaurant/cafe (licensed) 4,490 1,730 Restaurant/cafe (unlicensed) 3,460 1,730 Caterer 3,740 1,870 Delicatessen 3,460 1,730 Fruiterer/greengrocer Take-away food shop 3,350 1,675 Mixed business (e.g., milk bar, convenience store) 4,170 2,085 1 These amounts are taken from TD 2015/9 which is the current determination and which applies for the 2014/15 income year. 2 Amounts are GST-exclusive. Page 18 July Supplement 2015

3 July Supplement 2015 Income-producing Building Write-off Rates Use of Building Capital Works Commenced Write-off Rate Non-residential buildings Industrial 27/2/ Non-industrial buildings 20/7/ /8/ /8/ /9/ /9/ Research & Development buildings 21/11/ Residential buildings Short-term traveller accommodation 22/8/ /8/ /8/ /9/ /9/ /2/ /2/ Residential income-producing buildings 18/7/ /9/ /9/ Structural improvements 27/2/ Environment protection earthworks 19/8/ For an industrial building constructed before 27 February 1992, the rates for non-industrial non-residential buildings are applied. Voice Page 19

4 Voice Prime Cost and Diminishing Value Rates (150 and 200) For most items of plant and equipment acquired* on or after 10 May 2006, the diminishing value method (DVM) rate was increased from 150 to 200. This means that the DVM depreciation rate is twice the prime cost (PC) rate of depreciation for such assets. Note(*): For these purposes, a taxpayer acquires an asset when they commence to hold it (e.g., on settlement of a contract). Therefore, a taxpayer may acquire an asset on or after 10 May 2006 under a contract entered into before 10 May 2006, and still use the 200 DVM rate. The 200 DVM depreciation rates apply to new and second-hand assets, including those with statutory caps (e.g., trucks). The rates also apply to both business assets and investment assets (e.g., assets used in a rental property). However, the 200 DVM depreciation rates do not apply to taxpayers using the SBE rules and assets classes for which there are special arrangements (e.g., new horticultural plants). For the purposes of the 200 DVM depreciation rates, specific assets are also excluded. The types of assets excluded from the 200 DVM depreciation rates are: u In-house software u Intellectual property assets (except copyrights in a film) u Spectrum licences u Datacasting transmitter licences u Telecommunications site access rights The following table sets out the effective PC and DVM rates of depreciation that apply to an asset based on its effective life. For example, a taxpayer may choose to use the Commissioner s effective life of 10 years for a particular asset. In that case, the PC rate of depreciation would be 10 (i.e., 100 divided by 10 (years)). The equivalent DVM rate of depreciation would be either 15 (at 150 DVM rates) or 20 (at 200 DVM rates) depending on whether the depreciating asset was acquired before 10 May 2006 or on or after 10 May Prime cost rate (150) 0.5 * * * * * * Effective Life (years) (200) Page 20 July Supplement 2015

5 July Supplement 2015 Effective Life (years) Prime cost rate (150) (200) Note: Where assets are acquired during the year, depreciation must be calculated on a per day basis. Therefore a 100 or higher depreciation rate does not equate to an immediate write-off unless the asset is held for (up to) a full year. * In the first year, the depreciation claim cannot be greater than the original cost and, over the life of the asset, total depreciation claimed cannot exceed the asset's original cost. Voice Page 21