LAWS3101 Study Guide - Midterm Guide: Mortgage Loan, Improper Conduct
Document Summary
General deduction provision s8-1 of itaa 1997 gives taxpayers a deduction for an expense. It is a general deduction provision as it has the potential to apply to any expense of the taxpayer. Section 8-1(3) states that a loss or outgoing that is deductible under s8-1 is called a general deduction . Section 8-1 itaa97 contains the main general deduction provision that explains that a loss or outgoing is deductible if. It is incurred to produce assessable income; or. Necessarily incurred in carrying on a business for the purpose of gaining or producing assessable income. ^ this rst rule" (these 2 elements) is called the positive limb". It must satisfy one of these elements to be deductible. In most cases, it is easy to work out if a loss or outgoing relates to earning income from: E. g. the cost to buy trading stock, marketing expenses, the cost of factory equipment used to produce goods.
