# Reviewer verdict — bounty-04-small-business-general-pool > **Reviewer:** Benjamin Mueller, Tax Agent (TPB — lapsed) > **Consent posture:** named > **Reward paid (AUD):** $600 > **Verdict outcome (from reviewer's §6):** FIX > **Verdict date:** 2026-07-10 > **PII sweep:** applied (see build script for pattern set); receipts logged in this PR body. --- --- brief_id: bounty-04-small-business-general-pool bounty_title: "Small business general pool" statutory_anchors: "Subdiv 328-D ITAA 1997" reviewer: name: "" credential_class: "TPB" registration_status: "lapsed" jurisdiction: "Australia" attribution_posture: "initialled" reviewed_calculator_version: "lodgeit-labs/Depreciation_Transforms v0.1.3" submission_date: 2026-07-10" top_level_verdict: "FIX" verdict_hash: "" --- # Reviewer Verdict — Small business general pool **Bounty:** bounty-04-small-business-general-pool ## 1. Top-level verdict **Your top-level verdict: FIX** The pool skeleton is correctly translated — the 15%/30% rate split, the addition and termination-value flows, and the roll-forward arithmetic reconcile internally. However, specific statutory predicates are wrong, and two of them make the brief's own FY2024-25 reference answer incorrect in law. Working the scenario from first principles, the correct output is **total deductions $19,325 and closing pool balance $23,425**, against the published $8,700 and $34,050. The errors are each localised, cited, and fixable with targeted changes: 1. **Mandatory IAWO classification (flips the reference answer).** The $12,500 trailer cannot be pooled: s 328-180(1) is imperative ("You deduct…") and s 328-185(1) excludes from pooling any asset "for which you have deducted or can deduct an amount under section 328-180". No election to pool an IAWO-eligible asset exists; the only choice in the Subdivision is the all-or-nothing s 328-175(1) choice. Fix: gate pool additions on the year's IAWO threshold; correct the reference answer. 2. **Threshold must be year-parameterised.** The $1,000 in s 328-210(1) is displaced by $20,000 for income years within 1 July 2023 – 30 June 2026 (IT(TP)A 1997 s 328-180(6)) — including the example year. Fix: a year-indexed threshold table, not a constant. 3. **Low-pool test timing.** The s 328-210(2) amount is tested before subtracting the year's 15%/30% decline; the published mechanics test after, which over-triggers the write-off. Fix: test the pre-decline amount; the write-off replaces the s 328-190 deductions. 4. **Negative pool.** Where termination values drive the balance below zero, the shortfall is assessable income (s 328-215(2)) with the pool closing at zero — not a negative deduction. Fix: separate output field. 5. **Taxable purpose proportion.** Additions, termination values and the low-pool test amount must all be TPP-scaled (ss 328-190(2), 328-200, 328-205, 328-210(2)); the published mechanics carry no TPP. Fix: TPP inputs, or a documented upstream-adjustment contract. Detail per question follows; edge cases in Section 4. --- ## 2. Per-question verdicts ```yaml per_question_verdicts: - question_number: 1 verdict: "ACCEPT" citation_authority: "ss 328-190(1)-(4) ITAA 1997" reasoning: | First year: 15% of the taxable purpose proportion of the asset's adjustable value, for assets first used or installed ready for use for a taxable purpose in the year — a flat rate with no pro-rata by acquisition date. Subsequent years: 30% of the opening pool balance (s 328-190(1)). Cost addition amounts for assets first used in an earlier year: 15% of the TPP of the amount in the year incurred (s 328-190(3), (4)). The brief's 15%/30% statement is correct. edge_case_notes: | Minor: the statutory 15% base is adjustable value, not cost (s 328-190(2)). Identical for assets acquired and first used in the same year; different for an asset held earlier but first used for a taxable purpose in the current year. Worth a code comment. - question_number: 2 verdict: "FIX" citation_authority: "s 328-210(1)-(3) ITAA 1997; s 328-180(6) Income Tax (Transitional Provisions) Act 1997" reasoning: | The base figure is $1,000, set by s 328-210(1), tested against the s 328-210(2) amount (opening balance + TPP of additions and cost additions − TPP of termination values) where that amount exceeds zero. Two corrections to the brief's statement. (1) Amount: for income years within 1 July 2023 – 30 June 2026, IT(TP)A s 328-180(6) substitutes $20,000 — so the operative figure for the brief's own FY2024-25 example (and FY2025-26) is $20,000, not $1,000. FY2024-25 was enacted by Act No 29 of 2025; FY2025-26 by the Treasury Laws Amendment (Strengthening Financial Systems and Other Measures) Act 2025. (2) Timing: the test amount is computed BEFORE subtracting the year's 15%/30% decline (confirmed by ATO guidance: "before calculating your deduction for the year"), and the write-off is taken INSTEAD of the s 328-190 amounts, with the closing balance becoming zero (s 328-210(3)). The published mechanics test the post-decline balance against a constant $1,000 — both elements need the targeted fix described in Section 1. edge_case_notes: | From 1 July 2026 the figure reverts to $1,000 under current law; the permanent $20,000 announced in the 2026-27 Budget (12 May 2026) was not yet law at the review date. The engine's threshold table must track this transition rather than hardcode either figure. - question_number: 3 verdict: "FIX" citation_authority: "ss 328-190(2), 328-200, 328-205, 328-210(2), 328-225 ITAA 1997" reasoning: | Only the taxable purpose proportion enters the pool. On the posited facts (mower 70% taxable purpose): pool addition = 70% × $28,000 = $19,600 (s 328-200 step 1; s 328-205); first-year decline = 15% × $19,600 = $2,940 (s 328-190(2)) — not $4,200. The private 30% never enters the pool and attracts no deduction. On a later disposal, the pool is reduced by TPP × termination value, using the s 328-205(4) average of estimates where business use changed across years. The published mechanics carry no TPP on additions, termination values or the low-pool test amount and therefore cannot produce these figures; if TPP adjustment is intended to occur upstream of the calculator, that contract should be stated explicitly in the interface. edge_case_notes: | Where the business-use estimate later moves by more than 10 percentage points, s 328-225 requires a pool adjustment (available only up to the third income year after allocation, s 328-225(5)). No mechanism for this exists in the published mechanics. - question_number: 4 verdict: "FIX" citation_authority: "ss 328-200, 328-215(1)-(3), 328-205(4) ITAA 1997" reasoning: | The pool is indifferent to the ute's original cost ($22,000) and to deductions previously claimed: while an asset is pooled there is no per-asset balancing adjustment, and only the TPP of the termination value ($6,500) is subtracted (s 328-200). That much of the brief's treatment is correct. The incomplete part is the negative-pool arm: if termination values drive the closing pool balance, or the s 328-210(2) amount, below zero, the amount below zero is included in assessable income and the closing balance becomes zero (s 328-215(2), (3)). Note the comparator includes current-year additions — it is not simply "proceeds exceed opening balance" as the question frames it. The published mechanics would emit a negative deduction in this scenario (e.g. opening $5,000, disposal $9,000 → "deduction −$4,000"); the magnitude coincides with the assessable amount but the sign and character do not, and a consumer clamping deductions at zero would produce a materially wrong return. edge_case_notes: | Disposal of substantially the whole pool on cessation of business is the natural stress test of this arm. - question_number: 5 verdict: "REJECT" citation_authority: "ss 328-175(1), 328-180(1), 328-185(1) ITAA 1997; s 328-180(4) Income Tax (Transitional Provisions) Act 1997" reasoning: | The question's premise — that the taxpayer "could have elected" IAWO and may instead pool an eligible asset — has no statutory basis. While an SBE calculates deductions under Subdiv 328-D, the immediate write-off is mandatory: s 328-180(1) provides "You deduct the taxable purpose proportion..." (imperative), and s 328-185(1) pools depreciating assets "except assets for which you have deducted or can deduct an amount under section 328-180" — the words "can deduct" exclude the asset from the pool whether or not the deduction was in fact claimed. The only election in the Subdivision is the all-or-nothing s 328-175(1) choice to use it. Applied to the brief: P1 ($28,000 ≥ $20,000) is correctly pooled; P2 ($12,500 < $20,000) must be written off in full and cannot be pooled. This flips the reference answer: correct FY2024-25 totals are $19,325 deductions ($12,500 IAWO + $4,200 first-year decline on P1 + $2,625 pool decline) and a $23,425 closing balance, against the published $8,700 and $34,050 — a $10,625 divergence fully explained by this point. edge_case_notes: | The IAWO cost test is applied to the asset's GST-exclusive cost for a registered entity: a $22,000 GST-inclusive purchase nets to $20,000, which is not "less than" the threshold — pooled, not written off. A boundary the engine should test. - question_number: 6 verdict: "FIX" citation_authority: "s 328-195(2) ITAA 1997; s 328-181(5) Income Tax (Transitional Provisions) Act 1997; ss 328-220, 328-175(10) ITAA 1997" reasoning: | Principal finding — opening-balance provenance. s 328-195(2) defines the opening balance as the prior year's statutory closing balance, and prior-year law tightly constrains what balances are reachable. Temporary full expensing compulsorily zeroed every simplified-depreciation pool for income years ending 6 October 2020 – 30 June 2023 (IT(TP)A s 328-181(5): s 328-210(1) applied disregarding "less than $1,000 but"; SBEs using the regime could not opt out). FY2023-24 pool additions were then confined to assets of $20,000 or more each (mandatory IAWO below that), and the $20,000 low-pool test wiped any 30 June 2024 pre-decline balance under $20,000. Absent FY2023-24 disposals, a continuing user's FY2024-25 opening balance is therefore $0 or at least $17,000 ($20,000 × 85%). The scenario's $8,750 is reachable only on contrived facts (≈$75,000 of additions offset by ≈$55,000 of termination values) — yet it falls out of the published mechanics in one step (a single ~$10,294 asset pooled in FY2023-24 under the $1,000 predicate, where the law sends the asset to IAWO and leaves the pool at nil). The reference scenario is thus consistent with the mechanics under review and barely consistent with the statute, which suggests reference vectors should be generated from the statute rather than from the engine. Recommended fix: treat opening balance as an asserted input — either validate reachability where asset history is available, or emit an explicit assumption notice ("opening balance supplied; not verified against prior-year TFE/low-pool-value rules"). Lawful readings that would legitimise $8,750 (a first-year entrant under s 328-195(1); a s 328-220 run-off pool) contradict the brief's own wording ("from prior year"; ute "previously in pool"). edge_case_notes: | On the brief's listed candidates: crossing the $10M turnover threshold — the pool continues under s 328-220 (30% run-off, no new allocations) even in non-SBE years; election in/out — the s 328-175(10) five-year lock-out is suspended for income years with a day on or before 30 June 2026 (IT(TP)A s 328-180(2)) and resumes after, unless further amended; whole-of-pool disposal — see Q4; TPP changes — see Q3 notes. One corner I could not conclusively resolve from the indexed sources: whether IT(TP)A s 328-181(5) forced run-off pools (s 328-220 entities not using the regime) to zero during the full-expensing years — flagged rather than asserted. ``` --- ## 3. Citation audit | # | Authority as cited | Your assessment | Notes | |---|---|---|---| | 1 | Subdiv 328-D ITAA 1997 (ss 328-175 to 328-260) as the governing anchor | ✓ correct citation | Correct Subdivision; operative sections for this bounty are ss 328-175 to 328-225. | | 2 | s 328-210 for the low-pool-value write-off, stated as "$1,000 threshold" | ⚠ citation exists but is misapplied | Right section, wrong operative figure for the years in play: IT(TP)A 1997 s 328-180(6) substitutes $20,000 for income years within 1 Jul 2023 – 30 Jun 2026, including the brief's FY2024-25 example. The brief also applies the test to the post-decline balance; s 328-210(2) tests pre-decline. | | 3 | 15% first-year / 30% subsequent-year rates (s 328-190, implied) | ✓ correct citation | Rates correct; note the 15% base is TPP of adjustable value (s 328-190(2)), and cost additions attract 15% under s 328-190(3), (4). | | 4 | "Elected pool treatment despite IAWO eligibility" (no section cited) | ✗ wrong citation | No statutory basis. s 328-180(1) is mandatory and s 328-185(1) excludes IAWO-eligible assets from the pool. The absence of a citation for this premise is itself the tell. | | 5 | Disposals: termination value subtracted from the pool (ss 328-200/328-215, implied) | ⚠ citation exists but is misapplied | Correct so far as stated, but incomplete: TPP scaling (s 328-205(4)) and the negative-balance assessable-income arm (s 328-215(2), (3)) are absent. | | 6 | Brief's scope note: full-expensing years "history; not relevant to a current-year audit" | ⚠ misapplied | TFE (IT(TP)A s 328-181(5)) determines which current-year opening balances are legally reachable — see Q6. | --- ## 4. Edge cases surfaced 1. **Threshold transition, FY2025-26 → FY2026-27.** Same pool, run for income_year 2025-26 vs 2026-27, must produce different low-pool outcomes ($20,000 vs $1,000 under current law; the announced permanent $20,000 from 1 July 2026 was not law at review date and must be tracked). Any engine ignoring its income-year input fails this by construction. 2. **Opening-balance reachability.** Feed FY2023-24 with opening $0 and a single $10,294 addition: correct treatment is mandatory IAWO with the pool remaining nil; mechanics that emit ~$8,750 have reproduced the brief's own scenario by an unlawful path (see Q6). 3. **Negative pool on heavy disposals.** Opening $5,000, disposal $9,000: expected output is $4,000 assessable income and a nil closing balance (s 328-215(2), (3)) — never a negative deduction. 4. **Boundary values.** Pre-decline balance exactly equal to the threshold (not "less than" → no write-off); s 328-210(2) amount of exactly zero ("more than zero" not satisfied → no deduction); GST-exclusive cost landing exactly on the IAWO threshold (pooled, not written off). 5. **Second-element cost additions.** A $4,000 tray fitted to a pooled ute in a year after acquisition: 15% deduction in the year incurred and $4,000 added to the pool (s 328-190(3), (4); s 328-200 step 1) — no input for this exists in the published mechanics. --- ## 5. TaxGenii appendix coverage feedback The "Primary statutory sections" block in the public-dispatch appendix was empty (reviewer-to-source), so all statutory text underpinning this verdict was drawn independently from AustLII consolidated compilations of ITAA 1997 and IT(TP)A 1997 and from ATO published guidance, accessed 8 July 2026. At my initiative I also ran two spot-checks against Tax Genii itself, on the two authorities this bounty most depends on. Both bottom-line answers were correct, but the citation layer needs attention. (1) "What is the low pool value threshold for FY2024-25?" returned the correct $20,000 — but its references pointed to the D6 "low-value pool deduction" items in the individual return instructions, which is the Division 40 low-value pool (a different regime that shares a confusingly similar name), rather than the SBE low pool value rule in s 328-210; it did not surface the operative provision (IT(TP)A 1997 s 328-180(6)); and its framing ("an income year that ends on or before 30 June 2025") does not acknowledge the legislated FY2025-26 extension of the $20,000 amount. A practitioner following that citation trail would land in the wrong Subdivision. The EM references point to earlier legislative vehicles for the measure rather than the enacted provision. (2) "Was the SBE pool write-off mandatory during temporary full expensing?" returned a correct and well-framed answer (mandatory, no threshold, no opt-out, income years ending 7:30 pm AEDT 6 October 2020 – 30 June 2023), though it cited s 328-210 ITAA 1997 rather than the transitional provision that effects the result (IT(TP)A s 328-181(5)). Two further coverage items worth feeding back: (1) the interaction of IT(TP)A s 328-181(5) with s 328-220 run-off pools during the full-expensing years appears unaddressed in the guidance I could locate, and is the one corner of Q6 I flag rather than assert; (2) the pending permanent $20,000 IAWO measure (2026-27 Budget) needs active tracking, as it changes the s 328-210 parameter from 1 July 2026. --- ## 6. Attestation I have reviewed this bounty artefact bundle on the facts as presented. My verdict above reflects my professional judgement as at the submission date. I understand my verdict will be minted into the public reviewer registry with the attribution posture stated in the frontmatter. This review was prepared with AI-assisted research; the statutory citations were sourced from consolidated primary text, and the analysis, conclusions and verdict are my own professional judgement. **Signed:** **Name: Benjamin Mueller **Credential: Tax Agent **Date:10 July 2026