These examples show how Investment Boost can be used in different types of businesses.
Jenaye's Fish 'n Chip shop is struggling to keep up with demand on Friday nights, so they invest in a new commercial deep fryer for $2,500. The shop can claim 20% of this cost as a deduction in that year's tax return - that's $500.
Jenaye's Fish 'n Chip shop can claim depreciation on the remaining 80% of the cost of the deep fryer ($2,000) as if that amount is 100% of the cost.
Ella Taxis is a taxi business. The business buys a car for $45,000 near the end of the 2025-26 income year.
Over the next 90 days, Ella Taxis keep records of when and why they use the car. They realise that they used half the car’s mileage for work and half for private use.
This means that the car is a mixed-use asset and only half of the expenses of running the car are deductible expenses.
Ella Taxis can claim half of the Investment Boost amount as a deduction in the 2025-26 income year – that’s $4,500.
Ella Taxis can calculate depreciation on the remaining 80% of the cost of the car ($36,000) as if that amount is 100% of the cost.
Planes Ltd owns and operates an airport. It wants to extend one of its runways by 1000m to accommodate wide-body jets and to allow aircraft to operate with heavier loads.
The consent process takes longer than expected so Planes Ltd applies for consent for an initial 300m extension. Consent is received and work on the 300m extension is physically completed on 20 April 2025. The certification allowing the extension to be used for aircraft operations is issued on 30 May 2025. Planes Ltd is continuing with the consent process for the additional 700m extension.
Planes Ltd can claim Investment Boost for the 300m extension even though they are also continuing with the 700m extension. This is because the 300m extension:
- has increased the capital value of the original runway
- was available for use on 30 May 2025, the date the certification was issued (not the date the work was finished).
Entertainment Ltd owns, constructs and operates major venues. It began constructing a new function centre in 2021 and completed it on 31 March 2025 (apart from minor finishing work). A Code Compliance Certificate was issued on 20 April 2025, which allowed the centre to open to the public. Between 20 April and 31 May 2025 Entertainment Ltd hired and trained staff for the function centre. The opening ceremony was on 1 June 2025.
The function centre first became available for use by Entertainment Ltd on 20 April 2025. This is the date the centre was physically and legally capable of being used by Entertainment Ltd in its business, even though it did not have staff or open the function centre until later.
Entertainment Ltd cannot claim Investment Boost for the function centre because it first became available for use before 22 May 2025.
Lope Ltd owns a 6-storey office building. In 2022, it discovered the building was earthquake-prone and unsafe to be occupied. It moved its employees out of the building and started strengthening the building to the required standard. The work was completed on 15 May 2025 (apart from minor finishing work). A Code Compliance Certificate (CCC) was issued on 1 June 2025, and the employees were legally able to move back in after this.
The improvement is the strengthening of the building as a whole. The improvement is not available for use until the work is physically complete and there is no legal barrier to reoccupying the building. For Lope Ltd this means the building is not available for use until 1 June 2025 when the CCC was issued. As the improvement is available for use after 22 May 2025, Investment Boost is available.
If Lope Ltd took a staged approach
Suppose Lope Ltd does not have the money to do all the work at once and takes a staged approach to strengthening different parts of the building over time. For each stage, Lope Ltd applies for a separate building consent and CCC.
In this situation, the work done in each stage is an alteration or repair that is an ‘improvement’. Each improvement increases the capital value of the building. However, because the building is earthquake prone and cannot be occupied until the final CCC is issued, none of the improvements are available for use until that time.
The outcome may be different if there is no legal barrier to occupying the building after the completion of each improvement stage.
Bob claims a deduction for repairs and maintenance on a commercial building in his business’s income tax return. We disallow this deduction because we consider the expense is for a building improvement and capital in nature.
We amend Bob’s assessment to remove the deduction. As a result, Bob may instead claim an Investment Boost deduction relating to that cost for that tax year, if the other requirements are met.