Section EE 8 — Income Tax Act 2007: Election that property not be depreciable

EE 8 Election that property not be depreciable Item acquired (1) A person may choose that an item of property they acquire not be depreciable property even though, in the absence of the election, it would be depreciable property. Item changing use (2) A person may choose that an item of property they own ceases to be depreciable property if— (a) the use of the item changes; and (b) before the use changes, the person was denied a deduction for an amount of depreciation loss for the item; and (c) after the use changes, in the absence of the election, the person would have been allowed a deduction for an amount of depreciation loss for the item. Retrospective election (3) A person who has deducted none of the amounts of depreciation loss for which they were allowed a deduction for an item of property, in the income year in which they acquired it and in each later year, may retrospectively choose that the item not be depreciable property. How elections made (4) An election under this section is made as follows: (a) a person makes an election under subsection (1) by giving the Commissioner notice of it in their return of income for the income year in which they acquire the item; and (b) a person makes an election under subsection (2) by giving the Commissioner notice of it in their return of income for the income year in which the item’s use changes; and (c) a person makes an election under subsection (3) by giving the Commissioner notice of it in their return of income for any income year after they acquire the item, including an income year after they dispose of the item. Effect of election (5) An election under this section has effect for the person for— (a) the income year for which they make the election; and (b) all later income years until— (i) the item is disposed of, although this reference to disposal does not include the disposal of an item of intangible property as part of an arrangement to replace it with an item of the same kind; or (ii) an event described in section EE 47 occurs involving the item. Retrospective effect of election (6) An election made under subsection (3) also has retrospective effect for the person for— (a) the income year in which they acquire the property; and (b) all intervening income years until the year in which they make the election. Defined in this Act: acquire , amount , Commissioner , deduction , depreciable property , depreciation loss , dispose , income year , notice , property , return of income , Compare: 2004 No 35 s EE 8