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Simplified depreciation rules

Small businesses can use the simplified depreciation rules as an alternative to the uniform capital allowances (UCA) rules to work out deductions for most depreciating assets.

Business means the individual, partnership, company or trust that carries on the business activity.

Small business means a ‘small business entity’, which is an individual, partnership, trust or company with aggregated turnover of less than $2 million.

New laws have passed that allow small businesses with an aggregate turnover of less than $2 million to immediately deduct assets they start to use or install ready for use, provided the asset costs less than $20,000. The general small business pool will apply to depreciating assets costing $20,000 or more. The measure will apply to assets acquired from 7.30pm (AEST) on 12 May 2015 until 30 June 2017.

Assets to which these rules apply

  • Some assets are excluded from the simplified depreciation rules. If you choose to use the simplified depreciation rules, you must use them to work out deductions for all your depreciating assets that the rules apply to.
  • If you have non-business income, such as salary and wages, you will also claim a deduction for depreciating assets you use in earning your employment income under these simplified depreciation rules.
  • Where you can claim a goods and services tax (GST) credit for a depreciating asset, you must deduct the amount of the GST credit from the asset’s adjustable value before working out the deduction for depreciation.


Griffin & Associates

79 Denham St, Townsville City QLD 4810

Phone 07 4772 6588

Chartered Accountants