Tax treatment of extended warranties?

[Spiny Norman]

Hi All,

we recently purchased a new fridge for our IP as follows:

Replacement Fridge $535.00
Additional 3 year warranty $119.00
Delivery $50.00
Disposal of old fridge $25.00

My understanding is that we depreciate the fridge and simply use the delivery and disposal as deductions.

What should I do with the extended warranty? Deduct or depreciate?

I will be going to an accountant, but I want to put the figures in the right part of my spreadsheet to hand over.

Cheers.

 

[boomtown]

Isn't there an immediate write off under $1000? I can't remember the threshold off the top of my head.

 

[Spiny Norman]

Isn't there an immediate write off under $1000? I can't remember the threshold off the top of my head.

It's $300 for write off and $1,000 to put it in the low value pool.

 

[syba]

Fridge, delivery and warranty all form part of the cost of the fridge so are added together and depreciated as one. Disposal cost is written off immediately.

 

[Rob G.]

A warranty contract would not usually be part of the cost for capital allowances.

It would normally be an immediate deduction even though it covers more than a year in advance since the amount is below $1000.

Cheers,

Rob