All Topics / Legal & Accounting / Are power tools and/or accessories deductible?

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  • Profile photo of Jacqui MiddletonJacqui Middleton
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    @jacm
    Join Date: 2009
    Post Count: 2,539

    Hi all,

    I am wondering:

    If I were to purchase a powertool such as a drill, sander, etc… for the purpose of being able to maintain and improve my IP, would the cost of purchase be a deductible expense?  If so, does it come under maintenance and repairs, or capital improvements?

    The same question applies to the accessory parts such as drill bits.

    Please note; my question is relevant to a property held in my own name (ie not a company or trust or SMSF).

    Thankyou in advance!

    JacM

    Jacqui Middleton | Middleton Buyers Advocates
    http://www.middletonbuyersadvocates.com.au
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    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of Jacqui MiddletonJacqui Middleton
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    @jacm
    Join Date: 2009
    Post Count: 2,539

    anyone?

    Jacqui Middleton | Middleton Buyers Advocates
    http://www.middletonbuyersadvocates.com.au
    Email Me | Phone Me

    VIC Buyers' Agents for investors, home buyers & SMSFs.

    Profile photo of DerekDerek
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    @derek
    Join Date: 2004
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    Not an accountant so disclaimer applies.

    Tools would only be deductible if they were considered oart of your business. If your property investment qualified as a business then you may be able to claim tools. If you are like most people and your property investment is sufficient to be classified as a business then the answer would be no.

    Even if you qualifed as a 'property business' there would have to be any apportioning of tool use for private purposes.

    Profile photo of Jamie MooreJamie Moore
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    @jamie-m
    Join Date: 2010
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    Not an accountant either – but I wouldn’t think they were deductible.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
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    Mortgage Broker assisting clients Australia wide Email: [email protected]

    Profile photo of Rob G.Rob G.
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    @rob-g.
    Join Date: 2010
    Post Count: 70
    JacM wrote:
    Hi all,

    I am wondering:

    If I were to purchase a powertool such as a drill, sander, etc… for the purpose of being able to maintain and improve my IP, would the cost of purchase be a deductible expense?  If so, does it come under maintenance and repairs, or capital improvements?

    The same question applies to the accessory parts such as drill bits.

    Please note; my question is relevant to a property held in my own name (ie not a company or trust or SMSF).

    Thankyou in advance!

    JacM

    The tools and accessories (as opposed to any consumable items such as sanding discs) would be capital.

    They may be depreciated, and a deduction claimed for the taxable use proportion of their decline in value.

    To the extent they are mainly used for earning income other than from a business then any items costing no more than $300 may be depreciated 100% in the year of purchase.

    Cheers,

    Rob

    Profile photo of OceanArchitecturalOceanArchitectural
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    @oceanarchitectural
    Join Date: 2011
    Post Count: 31

    What Rob said.

    In addition, there are occasionally various initiatives brought out by government that allow further tax concessions eg about a year ago, if you purchased any capital equipment new with value in excess of $1000 you could write it off immediately. Simultaneous, at the moment there is a capital gains incentive for small business with a 50% reduction in CGT, although I am unsure of the details. One of my notoriously sneaky buddies was telling me about it a couple of days ago. Chat to a decent accountant or call the ATO

Viewing 6 posts - 1 through 6 (of 6 total)

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