Additions to the list of depreciable land improvements
(35 – PricewaterhouseCoopers, 67 – New Zealand Institute of Chartered Accountants)
Clause 423(2) should be amended to include indoor land improvements. An alternative is that indoor sports grounds with purpose-built surfaces should be depreciated separate from the building under the “building fit-out” asset category.
The provisions will enable taxpayers to claim depreciation deductions for purpose-built surfaces if the surface is a land improvement that previously did not meet the definition of “depreciable land improvement”.
Officials consider that an indoor purpose-built surface will generally form part of a building and buildings that are already depreciable land improvements. With respect to the alternative submission, the Commissioner already has the power to determine whether a type of indoor surface is a separate item of depreciable property (from the building) and can, where appropriate, allow a separate depreciation rate. For these reasons we do not support the submissions.
That the submissions be declined.
(67 – New Zealand Institute of Chartered Accountants)
The term “grounds” should be replaced by “facilities”.
The term “facilities” is a broader term and it may better cater for development of the law in this area.
That the submission be accepted.