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CGT & depreciation of Fittings and fixtures

Discussion in 'Accounting, Tax & Legal' started by MJK, 27th Jul, 2006.

  1. MJK

    MJK Well-Known Member

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    Reading the article in the August/latest API magazine on page 72 re Hidden Tax slug 1. They are suggesting that all depreciation reduces the cost base for CGT.

    I can't believe the amount of conflicting advice on this! I would really love to hear peoples veiws on this article. Especially those in the know.

    MJK :confused: :confused:
     
  2. MrDarcy

    MrDarcy Well-Known Member

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    I read that too. I am quite sure that only Sec 43 (building allowance) is clawed back, not plant. I have had that confirmed by someone once, and that is what my accountant does when I sell a place.

    Of course, API being such a greate source of info, must be correct :eek:

    Oh, just read you wanted to hear from peope in the know, then pls ignore all of the above !
     
    Last edited by a moderator: 28th Jul, 2006
  3. MJK

    MJK Well-Known Member

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    Mr Darcy,

    Not just from people in the know, just some included. Please all comments welcome.

    MJK:D
     
  4. MJK

    MJK Well-Known Member

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    Any of the accounting experts prepared to comment?

    MJK
     
  5. NickM

    NickM Co-founder Staff Member

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    Sorry for the delay but clients do tend to take up my time at this time of year :D

    I have read the API article and it does seem to be a little ambiguous.

    The only capital allowance (depreciation) you addback for CGT purposes is the Div 43 allowabce. Also commonly known as building allowances and is generally claimed at the rate of 2.5% pa

    The ATO guide to CGT is useful and supports this view.

    www.ato.gov.au/content/downloads/NAT4151-06.pdf.

    Have fun !
    NickM
     
  6. MJK

    MJK Well-Known Member

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    Thanks Nick,

    I thought I had this resolved untill I saw this article. It is very relevant to my circumstances so thankyou for your reply. I did have a gander at the download from the ATO recently and believe it supports your/our veiw. The article in the API just shattered my bubble!

    MJK:D