AFMBalance allowance/charge

Somebody pls solve it out

I did not not see the question you want solved. All the same, in case you do not understand what those words mean, Balancing allowance is allowed for tax at corporation tax rate where upon scraping the company's asset on which capital allowance had been claimed and its less than the the written down value. i.e wdv>disposal proceeds then the diff. allowed for tax @ tax rate. the exact opposite is balancing charges

Thanks for your explaining,Sephfem

So as you said, the capital allowance is always claimable if wdv>disposal proceeds, and balance charges if wdv

i will review the question and get back to you. u would have made my work easier by telling me the question number and perhaps page

The question in FTC is Q9 pg 14
and in BPP is Q15 pg 14

Many thanks

Shaojia,

The tax claimable on account of balancing allowance or payable on account of balancing charge has been already adjusted with the yr 5 realisable value. So it is not to be considered in the CA calculations.

This is what I understood.

in the sleepon question only 250,000 of the 400,000 cost of the project is to be subjected to capital allowance computation at 25%reducing balance over 4 years so at the end of the 4 yrs wdv will be nil, as such there will neither be balancing charges nor allowance. the after tax realisable value relate to the part of the project cost not subject to capital allowance computation. besides its been valued after tax and has nothing to do with balancing charges or allowance. I do hope u find dis view invaluable

Rave,

Thanks for your help,I think I should review this question more carefully.

Sephfem,

Thanks, it makes sense, but i will think it for a while.