Hi,
we have purchased and planted horticultural plants this tax year to be used as essential oils in future years . Can these be fully depreciated under the Instant Asset Write-Off?
Also, can Bearer Plants (fruit trees) that have been planted be fully expensed or depreciated under the Instant Asset Write-Off?
Thank you
Hi @Lala2,
@macfanboy's answer is correct.
Temporary full expensing (under general depreciation) specifically excludes primary production assets. Our website advises:
Eligible assets do not include:
If you choose to apply simpler depreciation, the instant asset write-off (reduced to $1,000 from 1 January 2021) still excludes horticultural plants.
You'll need to depreciate the plants using our calculation for the decline in value of horticultural plants.
You can read more about excluded assets for the instant asset write-off and temporary full expensing on our website.
You should find your answers here:
Yes thanks that would be the normal method. I wanted to know if they fell into the govt scheme of being able to write off immediately for this tax year - as with plant and equipment etc
Hi @Lala2,
@macfanboy's answer is correct.
Temporary full expensing (under general depreciation) specifically excludes primary production assets. Our website advises:
Eligible assets do not include:
If you choose to apply simpler depreciation, the instant asset write-off (reduced to $1,000 from 1 January 2021) still excludes horticultural plants.
You'll need to depreciate the plants using our calculation for the decline in value of horticultural plants.
You can read more about excluded assets for the instant asset write-off and temporary full expensing on our website.
Thank you Blake,
so as a small business- Primary Producer, using the simplified depreciation method, the plants can be immediately expensed fully? I am finding the information slightly confusing.
From ATO Website - Temporary Fully Expensing
EXCLUSION for
'certain primary production assets (water facilities, fencing, horticultural plants or fodder storage assets), unless you are a small business entity who chooses to apply the simplified depreciation rules to these assets'
Hi @Lala2
Sorry about the confusion caused by the website.
As @BlakeATO has advised, for horticultural plants you can't claim a full deduction for them immediately. You can instead claim a deduction for their decline in value.
Take a look at our website for Calculating the decline in value for horticultural plants.
Ari
3,586 views
5 replies