CC 15New investment assets: change of use

1. This section applies if a person that has deducted an amount for a new investment asset under section DI 5 (New investment asset deduction) subsequently changes the use of the asset such that the percentage of deductible use of the asset under subpart DA (General rules) would change, applying apportionment to the permissions and limitations applicable for section DI 5.

2. This section does not apply if, for the asset, the amount given by the following formula, expressed as a percentage, is less than 25%:

   $1\; -\; (new\; use\; ÷\; previous\; use).$

   Where:

3. The person has, for the asset, an amount of income equal to the amount calculated by the following formula:

   $DI\; 5\; deduction\; -\; (new\; use\; ÷\; previous\; use\; \times \; DI\; 5\; deduction).$

   Where:

4. In the formulas in subsections (2) and (3),—

5. new use is the new percentage of deductible use under subpart DA for the asset, applying apportionment to the permissions and limitations applicable for section DI 5, expressed as a decimal:
6. previous use is the previous percentage of deductible use under subpart DA for the asset, applying apportionment to the permissions and limitations applicable for section DI 5, expressed as a decimal:
7. DI 5 deduction is—
   1. the amount of the deduction under section DI 5 for the previous use, if subparagraph (ii) does not apply:
   2. the amount given by the terms in the round brackets in the formula in subsection (3) the previous time this section applied to the asset, if this section previously applied to the asset.

8. For an item that is depreciable property, the amount of income under subsection (3) increases the item’s adjusted tax value for the purposes of section EE 48(1)(a) (Effect of disposal or event).