Page 21 - F6 - Capital Allowances - Intellectual Property & Recoupments
P. 21
Example
During the 2015 year of assessment, Helper Ltd (with a
March year end) sold a manufacturing machine to Support
(Pty) Ltd. The machine originally had a cost price of R500
000 and tax allowances of R400 000 have been deducted
for tax purposes on this machine. The terms of the sale
were a cash amount of R50 000 on date of sale and then
10% of the value of products produced by the machine for
the subsequent two years. Assume that the amounts
eventually received were R20 000 (2016) and R25 000
(2017).
Calculate the implications of the above transaction for
Helper Ltd for the 2015, 2016 and 2017 years of
assessment.
