Creating a General Small Business pool and adding an asset

This support note applies to:

AO Tax (AU)
AE Tax Series 6 & 8 (AU)
AE Tax (AU)

Article ID: 36657

In MYOB Tax you can create a depreciation pool and assign assets to the pool. These instructions will step you through the current process available with respect to the current legislative requirements when creating a General Small Business pool and adding an asset to the pool. The same steps can be used for assigning assets to other pools such as the Low value pool.

Currently, the Small Business Entity (SBE) rules are in effect and have been in effect since the 2009 tax year. If you need to create a pool in a tax return prior to the 2009 tax year, ensure that you assess your client's eligibility in accordance with the relevant legislation for that tax year.

Example: If preparing a 2008 tax return and you need to add a pool and pooled assets, the Simplified Tax System (STS) rules and thresholds apply.

If you have any queries about these legislative rules and thresholds please contact the ATO.

Creating a pool and adding an asset to a pool is a three part process that involves:

Completing the Eligibility Test
Creating the Pool and then
Adding a new asset to the Pool.

Complete the eligibity test

This process is done when you first decide to declare yourself as a Small Business Entity (SBE) and is required to be completed in every subsequent tax year. We recommend always checking that this election has been made correctly as this information will not rollover from prior year.

If this eligibility section has not been completed and the selection has not been made, you will not be able to add an asset to GSBP. You will receive the message " Taxpayer is no longer a samll business entitled to use the simplified depreciation rules and new asset may not be added to the pool". Please ensure that the eligibility section has been completed

To make or check the election as an SBE

To make or check the election as an SBE you will need to perform the following instructions from within the tax return.

Click the Preparation drop down menu and select Schedules. The Select Schedule Type window opens.
Highlight the Depreciation Worksheet and click Select. The Depreciation Worksheet Index opens.
Click Check SBE eligibility. The Small Business Entity - Eligibility Tests window appears.
Answer the two (2) Eligibility Tests.

For a business to be classed as an SBE you will need to have inserted Y into both tests 1 and 2.
Press F6 or to save. The Small Business Entity - Eligibility Tests window is saved and the Depreciation Worksheet Index appears

To create the pool

This process is done when you first decide to create a pool. If the return in a prior year had a pool with a closing balance, when rolling the tax return to the next income year, this information will be retained. We do recommend checking your integration settings to ensure that they are correct.

Once you have made the election as an SBE, perform the following instructions from within the Depreciation Worksheet Index window in the tax return to create the pool.

Click Create Pool. The Pool Properties window opens and displays the Details tab.
Click the drop down arrow and select the pool. In this example the General Small Business Pool has been selected.
Type a title for your pool in the Description field.
If required, for a new client with existing pooled assets enter the Opening Balance in the Adjustable value (OWDV) field, otherwise leave this field blank and proceed to Step 5.

Only complete Step 4 if you are entering a new pool that has a prior year closing written down balance which didn't previously exist in MYOB Tax.
Click the Integration tab. The Integration tab details display.
Click the drop down arrow at the To form/schedule field.
Highlight and click the desired selection.

The integration options display and are valid for the tax return form that you are currently in.

If the Share business proportions button becomes active, you are required to specify the percentage of the pooled depreciation that relates to each nominated business income schedule. This is done by clicking on the Share business proportions button. The at the SBE Integration of Pool deduction - Share window either click New to create a new entry or to edit an existing entry highlight the entry and click Properties. Ensure that a percentage is assigned and that the total percentage values assigned across all business income schedules doesn't exceed 100%.

Click OK when all the integration details and sharing proportions have been entered. The Pool Properties window appears.
Click OK. The Depreciation Worksheet Index window appears and lists the GSBP

To add a new asset to the pool

This process is used when adding new assets to an existing pool. If the return in a prior year had a pool with a closing balance, when rolling over the prior year tax return this information will be retained.

The following process will be performed from the Depreciation Worksheet Index window. If you are not already at the Depreciation Worksheet Index window, follow Steps 1 and 2 from the instructions above in the Complete the Eligibility Test section.

Click New. The Depreciation Item Properties window opens.
Click the ellipses [...] button at the Pool field. All currently available pools are listed.
Highlight the pool and click Select. The Pool field is populated with your selection.
If you're using Groups please select or create a group by completing the Group and Description fields.

If you're not using Groups please continue to Step 5.
Type a number in the Asset no. field and enter an asset description in the Description field.
Ensure that the Type field is selected.
Enter the date of purchase in the Date purchased field.
Check that the Date first used/held ready field is correct.

Depending on the status of any pending legislation there will be a drop down arrow selection field.
Click OK to save your changes when all data has been entered correctly. The Depreciation Worksheet Index window appears.
At the Depreciation Worksheet Index window ensure that you have selected the Populate return labels option. A tick appears in the checkbox.
Click Close. The depreciation is calculated and integrated into the tax return.

In some returns the value of depreciation expense is not integrated, however the pool values required in other fields are pre-filled, this is by design.

Example: For the company return the calculated value for depreciation will not always be integrated into Item 6 label X as the accounting value of depreciation expenses (which can vary to what is permitted to be deducted for tax purposes) is entered in this field. Integration is to the Reconciliation Additions to Income Item 7 the necessary add back and subtraction labels which integrate to the main return labels B, W and F as required.