• 1) Disposal of depreciating asset - exempted from CGT
  • 2) Profit on Disposal of depreciating asset goes to P&L (e.g proceed > written down value (after depreciation to the point of sales)
  • 3) Sell equipment together with the business: the disposal of equipment will be treated in the same way as disposal of depreciating asset


At the Sale of the business, 2 scenario:

  • If the business Valuation $400k Disregard any asset value - no apportion go towards the asset (Business assets valuation in the sell price is $0.00) 
    • --> Capital gain = $400 minus any capital cost at purchase
    • the assets needs to be NIL down


  • If the business Valuation includes the asset into the sales price - the sell price needs to be broken down and apportionated
    • Business sold for 400k
    • 50k worth of asset 
    • Business sold at 350k
  • --> Split:
    • Selling business 350k - CGT calculation = $350 - cost
    • profit / losses on selling 50k asset - will go to P&L


Conclusion: ATO link states: Does not matter selling the equipment together with the business or by itself, it always get handled in the same way https://www.ato.gov.au/business/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules---capital-allowances/disposing-of-a-depreciating-asset/


Ref 1051 4918 47630

ATO call recording link: https://app.toky.co/business/recording/inbound/8024be5c-ca21-1237-d98c-02d6eba9d8eb