Page 108 - P6 Slide - Taxation - Lecture Day 1

Implications of s 19

Assets on which

allowances can

Allowance assets be claimed.

debt owed by a person is AND Used for acquisition,
creation/improvement of an allowance
reduced
asset

1. Reduce base cost of asset to R0

2. Reduction amount less amount used to reduce base cost (par 12A) =

Recoupment (s 8(4)(a)) and (s19(6))

Recoupment of

remainder of debt
Reduction amount reduction

Debt reduced less
consideration paid

The amount of
debt reduced