This interpretation statement provides general guidance on how to identify the relevant item of property when applying the depreciation rules in the income tax legislation. The relevant item must be identified to ensure it is a depreciable item and, if so, to determine the applicable depreciation method and rate from which amounts of depreciation losses may be calculated. In many cases, this will be relatively straightforward.

However, in some cases it may be unclear whether an item is a standalone item of property or part of another item of property.

CA ANZ supports the publication of these items, as they will be helpful to both taxpayers and Inland Revenue. The draft interpretation statement is thorough and well-written with a concise summary. The fact sheet effectively highlights the key issues to be considered.

CA ANZ suggests that certain aspects of the items be reviewed and clarified, with additional references provided where necessary.