Is a tax allowance of say 50% on new PPE a tax depreciation affecting TWDV the following year or does the TWDV in period two = cost – accounting depreciation ?
e.g new PPE of 100 000 allowance of 50% accounting depreciation 10%
The 50% is applied to the 100,000 in the first year to give a TWDV of 50,000 and then the 50% is applied to this 50,000 to give the TWDV in the second year. The accounting depreciation is irrelevant in calculating the TWDV.