Page 73 - P6 Slide - Taxation - Lecture Day 1

Solution - Depreciable assets formulae

(par 30(4)) (cont.)

The depreciable proceeds formula should be used to determine the

proceeds that relate to the period before 1 October 2001:

Next, the TAB cost is determined using the depreciable TAB formula:

The total base cost is the TAB cost (R44), plus the expenditure incurred after

valuation date (R200 – 100) = R144.

The capital gain on the disposal using the TAB cost will be R356; ie ((R700 –

200) – R144).