Aquaculture

DO 12 Improvements to aquacultural business
When this section applies

(1)

This section applies when—

(a)

a person carries on an aquacultural business in New Zealand; and

(b)

the aquacultural business is—

(i)

fish farming under a licence issued under the Freshwater Fish Farming Regulations 1983; or

(ii)

mussel farming; or

(iii)

rock oyster farming; or

(iv)

scallop farming; or

(v)

sea-cage salmon farming; and

(c)

an improvement described in any of schedule 20, parts B to F (Expenditure on farming, horticultural, aquacultural, and forestry improvements) is made for the purposes of the business.

Deduction: expenditure: owner of improvement

(2)

A person who owns the improvement is allowed a deduction for expenditure to which all the following apply:

(a)

it is incurred on making the improvement; and

(b)

it is incurred by the person or by another person; and

(c)

it is incurred in the 1995–96 income year or in a later income year, not including the income year in which the person ceases to carry on the business, the income year being the income year of the person who owns the improvement; and

(d)

it is incurred in developing the business; and

(e)

it is of benefit to the business in the income year in which the person is allowed the deduction.

Deduction: expenditure: non-owner of improvement

(3)

A person who does not own the improvement is allowed a deduction for expenditure to which all the following apply:

(a)

it is incurred on making the improvement; and

(b)

it is incurred by the person; and

(c)

it is incurred in the 1995–96 income year or in a later income year, not including the income year in which the person ceases to carry on the business; and

(d)

it is incurred in developing the business; and

(e)

it is of benefit to the business in the income year in which the person is allowed the deduction.

Amount, and timing, of deduction

(4)

The amount of the deduction is calculated using the formula—

schedule 20 percentage × diminished value.

Definition of items in formula

(5)

In the formula,—

(a)

schedule 20 percentage is the percentage set out opposite the description of the improvement in any of schedule 20, parts B to F:

(b)

diminished value is the diminished value of the improvement.

Link with subpart DA

(6)

This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply.

Defined in this Act: amount, business, capital limitation, deduction, diminished value, general limitation, general permission, income year, New Zealand

Compare: 2004 No 35 s DO 6