Section DU 6 — Income Tax Act 2007: Depreciation

DU 6 Depreciation When this section applies: first case (1) This section applies when— (a) a mining company acquires an asset by incurring— (i) mining exploration expenditure or mining development expenditure; or (ii) the exploration expenditure or development expenditure referred to in section DZ 12(2)(a) (Mineral mining: 1954–2005); and (b) the company is allowed a deduction for the expenditure; and (c) the company uses the asset, wholly or mainly, to derive income from mining. When this section applies: second case (2) This section also applies when— (a) a mining company complies with section CU 6(2) (Compensation and scrap payment: use to replace or repair asset); and (b) the company incurs expenditure in replacing or repairing the asset; and (c) the company is allowed a deduction for the expenditure; and (d) the company uses the asset, wholly or mainly, to derive income from mining. No deduction (with exception) (3) The company is denied a deduction for an amount of depreciation loss for the asset from the time when it uses the asset wholly or mainly to derive income from mining until the time, if any, when it uses the asset wholly or mainly to derive income other than income from mining. Amount of depreciation loss (4) The asset has the value described in section CU 10(2) (Mining asset used to derive income other than income from mining) for the purpose of calculating the amount of depreciation loss that the company has for its use of the asset wholly or mainly to derive income other than income from mining. Link with subpart DA (5) Subsections (1) to (3) override the general permission. Defined in this Act: acquire , amount , deduction , depreciation loss , general permission , income , income from mining , mining company , mining development expenditure , mining exploration expenditure , pay , Compare: 2004 No 35 s DU 6