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Tax Administration Act 1994

Determinations - Determinations relating to depreciation

91AAI: Effect on special rate of change in circumstances

You could also call this:

"What happens to a special tax rate when circumstances change"

Illustration for Tax Administration Act 1994

You have an item that loses value over time, and the Commissioner set a special rate for it. If the circumstances that applied when the special rate was set no longer exist or have changed a lot, the Commissioner can change the special rate. The Commissioner can either cancel the old rate or cancel it and set a new one. You must use the economic rate or a provisional rate to work out the loss in value if the Commissioner cancels the special rate without setting a new one. The cancellation takes effect the day after you are told about it, or the day after it is published in the Gazette, depending on how you are notified, as stated in section 91AAM(5). The Commissioner's decision to cancel or change the special rate is based on the circumstances of your item, and you must follow the new rules from the date the cancellation takes effect.

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Part 5Determinations
Determinations relating to depreciation

91AAIEffect on special rate of change in circumstances

  1. This section applies when—

  2. the Commissioner has issued a determination setting a special rate for a person's item of depreciable property; and
    1. the circumstances that applied at the time the determination was issued—
      1. no longer exist; or
        1. have changed materially.

        2. The Commissioner may—

        3. revoke the determination without issuing a new determination; or
          1. revoke the determination and issue a new determination setting a new special rate for the item.

            1. If the Commissioner revokes the determination without issuing a new determination, the person must depreciate the item applying the economic rate or an applicable provisional rate.

            2. A revocation takes effect—

            3. if notice of the revocation is given to the person under section 91AAM(5), on the day after the date of the notice; or
              1. if the notice is published in the Gazette, on the day after the date of the publication.

                Compare
                • s EG 10(6), (7)
                Notes
                • Section 91AAI: inserted, on (effective for 2005–06 tax year and later tax years, except when the context requires otherwise), by section YA 2 of the Income Tax Act 2004 (2004 No 35).