Tax Principles for Fixed Assets 2-Part Webinar Series
In this webinar series we revisit the core tax principles associated with capital expenditure. We present a clear and practical framework to support your decision-making when classifying expenditure on fixed assets—covering topics such as when costs should be capitalised and which capital allowances may apply. We also discuss the tax implications of disposing of assets that qualify for allowances.
Part of our material is a comprehensive training manual, featuring essential information and practical examples, which serves as a valuable reference.
Practical examples are incorporated explaining key principles.
The outline of this webinar series is as follows:
Part 1:
Basic Framework: Classification of Capital Expenditure
We discuss the basic tax theoretical framework to apply when making decisions on how to classify expenditure incurred relating to “repairs and maintenance” and focus on the following key sections of the Income Tax Act:
a. Section 11(a) & 23(g) - General deduction formula
b. Section 11(d) - Deduction of expenditure on repair of property
Major Categories of Capital Allowances
This session works through the key principles of the following major categories of assets allowances:
· Section 11(e): Wear & tear allowance on non-manufacturing plant or equipment
· Section 12C: Manufacturing plant or equipment allowance
· Section 12B: Renewable energy allowance
· New Section 12V: Assets used in domestic production of electric and hydrogen-powered vehicles
· Section 13(1): Manufacturing building allowance
· Section 13quin: Commercial building allowance
Part 2:
Disposal of Fixed Assets: Recoupments & Capital Gains/Losses
In this session we quickly refresh the key tax principles regarding recoupments and capital gains when disposing of a fixed asset.
Capital Gains Tax is dealt with in detail in the Basics of Capital Gains Tax for Corporates webinar.
Leased Assets
This session refreshes the key principles regarding the tax treatment of leased assets, including recoupments and capital gains tax principles. We also work through basic examples on order to understand the practical application of these principles.
In this session we cover:
Capital allowances available to the lessor & lessee:
· Section 11(g): Leasehold improvement allowance
· Section 11(f): Deduction of lease premiums
· Section 11(h): Lessor Special Allowance
· Limitation of deductions available to lessor (Section 23A)
· Section 8(5) recoupments
CPD - 4 hours
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