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Deat Mike,
Would you be so kind tobexplain with an example the above mentioned transaction?
Many thanks,
Stefano
Hi again
The taxman doesn’t like our variable depreciation policies and it makes it altogether too difficult to run a tax system efficiently. Instead the tax man ignores our depreciation calculations and instead gives us capital allowances. Where we are depreciating at say 10% straight line, the taxman is allowing us 25% reducing balance.
But our neighbour is depreciating at 30% straight line. The taxman allows him 25% reducing balance too.
I believe that that’s what is being referred to in your post title – the taxman allowing capital allowances sometimes greater than the accounting depreciation charge
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