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Bach, Boat or Plane – Tax on Mixed-Use Assets

May 14, 2021

Chris Lynch, CA, Managing Director

Do you have a holiday home which you also rent out commercially? Or do you own a boat or a plane which you use privately as well as renting out for charter or other commercial purposes? These are known as mixed-use assets.

If you want to be able to claim tax deductions for them, you need to know about the mixed-use assets rules.

You need to work out how much the asset is used for business, that is, to earn income, and how much it is used privately. This decides how much income you declare and what expenses you can claim.

You are only able to claim deductions for costs incurred that relate to the asset’s income-earning use. You are not able to claim deductions for your own private use (note private use may include renting out mixed-use assets at less than market value). 

So, you need to keep track of when the asset is used to earn income and when it is used privately.

If annual income is less than $4,000 there may be the opportunity to opt out of the mixed-assets rules, noting however that if you take this option then you won’t be able to claim associated expenses.

The mixed-use asset rules also apply to GST.


Chris Lynch, CA

Managing Director

Ph: 09 366 6008

Email Chris

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