The amendments to the taxation treatment of business-related capital expenditure (referred to as ‘blackhole expenditure’) were intended to provide a “systematic solution” to the problems of the business blackhole expenditure regime. To achieve this end the amendments repealed the original rules that limited tax deductions to specific circumstances and replaced them with an all inclusive approach designed to capture everything not addressed in the Income Tax Assessment Act, 1936 and Income Tax Assessment Act, 1997. This presentation looks to consider the application of these rules and to apply them to practical situations. In particular, the new rules have introduced new terms as well as qualifying criteria that the expenditure must satisfy before the blackhole deduction is available.
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