Are man-made breakwaters plant for the purpose of claiming depreciation deductions?
• In 2008, the Administrative Appeals Tribunal (Tribunal) held (in Port of Portland Ltd v FC of T 2008 ATC 10-071) that two man-made breakwaters owned by Port of Portland Pty Limited, which form Portland harbour, are “plant” for the purpose of the taxpayer being entitled to claim depreciation deductions under Division 40 of the Income Tax Assessment Act 1997 (Cth) (1997 Act • The Tribunal determined that such breakwaters were “plant” because they were part of the means by which the taxpayer carried on its business rather than the setting in which the taxpayer’s business was carried on. • The Australian Tax Office (ATO) has issued a decision impact statement (DIS) acknowledging that the Tribunal’s decision is “partially adverse” for the Commissioner but concurring with the Tribunal’s decision.
