George is a self-employed builder and has several assets which have been used in his business (fully or partly) during his income year ended 31 March 2019 as follows:

An asset pool with an adjusted tax value of $18,000 as at 1 April 2018. The pool includes an asset that George is using for private purposes during the 2019 income year. He uses it privately for 20% of the time which started on 5 December 2018. The market value of the asset on 5 December 2018 was $1,500. The pool depreciation rate is 22% Diminishing Value

On 1 April 2018, George purchases five assets for $2,000 each, which he pools and uses a depreciation rate of 20% Diminishing Value.

On 1 April 2018 George had a set of pooled tools with a tax adjusted value of $6,000. In October 2018, George broke some of these tools (previously acquired for $240), acquires some new tools for $620 and sold some tools for $300. The pool depreciation rate is 40% Diminishing Value

On 1 April 2018, George acquired some new office equipment - a desk for $400, two chairs for $280 each and a small filing cabinet for $100 from Hamilton Furniture Ltd. The depreciation rates for the various items of office equipment are: Desk 8.5% Straight Line; Chairs 10.5% Straight Line and Filing cabinet 8.5% Straight Line.

Required:

i.With reference to the relevant section (s) in the Income Tax Act 2007, explain the conditions that must be satisfied to pool assets for purposes of depreciation.

ii.Calculate the depreciation of the assets for the 2019 income year

iii.Explain if there are any items purchased in the 2019 income year that can be immediately claimed as a deduction.

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