@Taxduck I found this online though - So what if it is a like for like replacement, does the following ring true?
Scrapping of older air con units
When an asset gets demolished or dumped before it has been fully depreciated in your tax depreciation schedule it can have the residual value written off in one lump sum.
We call this scrapping value.
Let’s say you throw out an air conditioner after 4-years because it had a major fault.
According to your tax depreciation schedule it may still have a residual value of, say, $2,000.
Instead of continuing to depreciate the air con year after year (which is now located at the bottom of a big pile at the dump) you can claim that $2,000 as an instant asset write off at 100% in the financial year the item was scrapped.
Plus… under the ATOs repairs and maintenance rules, you may even be able to claim the new replacement air conditioner as a 100% instant asset write-off too.
But to do this, the replacement air conditioning unit must be a like-for-like replacement.
Upgrading from a 2.0kw split system to a 3.0kw split system may be seen by the ATO as an upgrade.
This would mean you claim the new air conditioning unit at 20% pa rather than 100%
Author: Taxduck(Taxicorn)Taxicorn 2 July 2024
Link regarding capital allowances.
https://www.ato.gov.au/individuals-and-families/investments-and-assets/residential-rental-properties/rental-expenses-to-claim/rental-expenses-you-claim-over-several-years#ato-Capitalallowances
If your old air-conditioners were depreciating you can claim the balance of their value.
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