Q: Can the remaining value of a Division 43 asset (specifically a spa) used in an investment property, which has been written down to $6,300 (originally costing $9,200), be claimed as a full deduction now that it's been scrapped? If not, how is the remaining value at the time of disposal treated for tax purposes?
A: If a Division 43 asset, like a spa, is scrapped, the owner can claim an immediate deduction for the remaining value of the asset at the time of destruction. This deduction is calculated as the undeducted construction cost minus any compensation received for the destruction of the asset.
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