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Income Tax Act 2007

Timing and quantifying rules - Depreciation

EE 11: Calculation rule: income year in which item disposed of

You could also call this:

“How to calculate depreciation in the year you dispose of an item”

You don’t lose money on depreciation for things you own in the year you get rid of them. But there are some exceptions to this rule.

If you get rid of a building or something related to oil and gas work, you can still lose money on depreciation in that year.

There are special ways to figure out how much depreciation you lose in certain situations:

These rules help you know how much depreciation to count when you get rid of things you own.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1514523.

Topics:
Money and consumer rights > Taxes
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EE 12: Depreciation methods, or

“How to calculate the decrease in value of your property over time”

Part E Timing and quantifying rules
Depreciation

EE 11Calculation rule: income year in which item disposed of

  1. A person does not have an amount of depreciation loss for an item of depreciable property for the income year in which they dispose of it.

  2. A person has an amount of depreciation loss for an item of depreciable property for the income year in which they dispose of it, if it is—

  3. a building; or
    1. an item of petroleum-related depreciable property.

      1. A person has the amount of depreciation loss calculated under section EE 22(4)(a) for an income year for a disposal to which the subsection applies.

      2. A person has the amount of depreciation loss calculated under section EE 48(2) for a disposal or event to which the subsection applies.

      3. A person has the amount of depreciation loss calculated under section EE 50(6) for a disposal or event to which the subsection applies.

      4. A person has the amount of depreciation loss calculated under section EE 50(9) for a disposal or event to which the subsection applies.

      Compare
      Notes
      • Section EE 11 list of defined terms building: inserted (with effect on 30 July 2009), on , by section 84 of the Taxation (Budget Measures) Act 2010 (2010 No 27).