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General Determination DEP103: Depreciation Rate for skin therapy machines used for beauty treatments

Note to Determination DEP103

The Commissioner has recently been asked to consider what depreciation rate should apply for skin therapy machines used for beauty treatments. The beauty treatments include hair removal, reducing winkles, freckles, vascular lesions and pigmentation problems.

The asset uses intense light pulse (“IPL”) treatment supplemented by a Radio Frequency (“RF”) emitting mode, which radiates the follicles or skin cells with a shortwave or microwave radio frequency. In the RF mode, it is effectively operating as a diathermy machine (Diathermy is deep treatment of tissue by heat applied through RF or microwaves). The machine may include a handpiece which emits the light and/or RF that is waved over the skin and has a sapphire plate that touches the skin which is refrigerated by means of a circulating coolant to prevent overheating and burning.

Determination DEP103: Tax Depreciation Rates General Determination Number 103

This determination may be cited as “Determination DEP103 Tax Depreciation Rates General Determination Number DEP103: Skin therapy machines used for beauty treatments”.

1. Application

This determination applies to taxpayers who own items of depreciable property of the kind listed in the table below:

This determination applies for the 2017/18 and subsequent income years.

2. Determination

Pursuant to section 91AAF of the Tax Administration Act 1994, the general determination will apply to the kind of items of depreciable property listed in the table below by:

  • Adding into the "Medical and Medical Laboratory" and "Shops" industry categories, the new asset class, estimated useful life, and general diminishing value and straight-line depreciation rates listed below:
Asset class Estimated useful life
DV rate (%) SL rate (%)
IPL, Laser, Ultrasound or RF emitting skin treatment or depilation equipment. 8 25 17.5

3. Interpretation

In this determination, unless the context otherwise requires, words and terms have the same meaning as in the Income Tax Act 2007 and the Tax Administration Act 1994.

This determination is signed by Vanessa Montgomery on the 14th day of June 2018.

Vanessa Montgomery
Manager, Technical Standards, OCTC