Page 11 - F6 - Capital Gains Tax - Debt Reduction
P. 11
Solution (Allowance Asset)
Year ending 30 April 2015
The amount of the reduction in the debt of R1 500
000 will first be applied against the base cost of the
asset which will be reduced to Rnil; the base cost
being R1 500 000 less the allowances claimed of
R900 000, thus a base cost reduction of R600 000.
The remaining debt reduction of R900 000 (R1 500
000 – R600 000 (reduction applied against base
cost of asset) will be recouped in income (s 19(6)).
Recoupment under s 19(6) read with s 8(4)(a)
R900 000
