Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) You can deduct capital expenditure you incur at a time in an income year on a * landcare operation for:
(a) land in Australia you use at the time for carrying on a * primary production business; or
(b) rural land in Australia you use at the time for carrying on a * business for a * taxable purpose from the use of that land (except a business of * mining and quarrying operations).
Note: If Division 250 applies to you and an asset that is land:
(a) if section 250 - 150 applies--you are taken not to be using the land for the purpose of carrying on a primary production business, or a business for the purpose of producing assessable income from the use of rural land (except a business of mining and quarrying operations), to the extent specified under subsection 250 - 150(3); or
(b) otherwise--you are taken not to be using the land for such a purpose.
(1A) A * rural land irrigation water provider can deduct capital expenditure it incurs at a time in an income year on a * landcare operation for:
(a) land in Australia that other entities use at the time for carrying on * primary production businesses; or
(b) rural land in Australia that other entities use at the time for carrying on * businesses for a * taxable purpose from the use of that land (except a business of * mining and quarrying operations);
being entities supplied with water by the rural land irrigation water provider.
(1B) A rural land irrigation water provider is:
(a) an * irrigation water provider; or
(b) an entity whose * business is primarily and principally the supply (otherwise than by using a * motor vehicle) of water to entities for use in carrying on * businesses (except businesses of * mining and quarrying operations) using rural land in Australia.
Exception: plant
(2) However, you cannot deduct an amount under this Subdivision for capital expenditure on * plant, except:
(a) a fence erected for a purpose described in paragraph 40 - 635(1)(a) or (b); or
(b) a dam or structural improvement (except a fence) covered by paragraph (1)(c), (d), (e) or (f) of the definition of plant in section 45 - 40.
(2A) In applying paragraph (2)(b) to capital expenditure incurred by a * rural land irrigation water provider on a dam or structural improvement, the requirement in paragraph 45 - 40(1)(c) that the land on which the dam or structural improvement is situated be used for agricultural or pastoral operations is to be disregarded.
Exception: deduction available under Subdivision 40 - F
(2B) A * rural land irrigation water provider cannot deduct an amount under this Subdivision for capital expenditure if the entity can deduct an amount for that expenditure under Subdivision 40 - F.
Exception: deduction available under Subdivision 40 - J
(2C) You cannot deduct an amount under this Subdivision for capital expenditure if any entity can deduct an amount for that expenditure for any income year under Subdivision 40 - J.
Reduction of deduction
(3) You must reduce your deduction by a reasonable amount to reflect your use of the land in the income year after the time when you incurred the expenditure for a purpose other than the purpose of carrying on:
(a) a * primary production business; or
(b) a * business for the * purpose of producing assessable income from the use of rural land (except a business of * mining and quarrying operations).
(4) Subsection (3) does not apply to expenditure incurred by a * rural land irrigation water provider. Instead, a rural land irrigation water provider must reduce its deduction in relation to particular land by a reasonable amount to reflect an entity's use of the land in the income year after the rural land irrigation water provider incurred the expenditure for a purpose other than a * taxable purpose.