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The company has sufficient profits elswhere to recover tax allowable depreciation on the the project, in full, in year they are incured.
Could you please elaborate on the above information. why is that given to us ?
My understanding is that we should go on depreciation the asset indefenatly, with not balancing alowance calculation, am I right ?
If they did not have sufficient profits each year, then there would be a loss arising. That would mean no tax payable and therefore no tax saving on the tax allowable depreciation (instead, the loss would have to be carried forward to future years).