Mixed-use assets are holiday homes, boats and aircraft with both private and business use.
You have a mixed-use asset if during the tax year the asset is:
- used for both private use and income-earning use
- unused for 62 days or more.
The rules apply to any:
- property, regardless of cost price or current value
- boat or aircraft which had a cost or market value of $50,000 or more when you bought it
- additional item or accessory relating to the asset, for example a quad bike stored at a holiday home.
The rules do not apply to a:
- residential property used for long-term rental
- business asset where the private use is minor, for example once a year
- home office where your expense claim is based on floor area.
These are known as excluded assets.
Mixed-use assets and GST
The mixed-use asset rules also apply to GST as well.
If you're GST-registered, you can claim GST on the percentage of expenses that relate to the business use of the asset.
Learn more about the GST rules on mixed-use assets in the Tax Information Bulletin.
Opting out of the mixed-use assets rules
You can choose to exclude income or expenses relating to your asset from your income tax and GST returns when:
- your income from income-earning use is less than $4,000 for the tax year. This excludes income for private use.
- you have quarantined expenditure which is losses held over to a future tax year to offset against future profits from the asset. Some assets cannot be subject to quarantine rules.