CIMA F1 Syllabus C. Fundamentals Of Business Taxation - Calculating Tax Depreciation - CBE ^{2 / 4}

Tax depreciation allowances are available on eligible assets at a rate of 50% in the first year and 25% on a reducing balance basis in subsequent years, except for the year of disposal when a balancing charge or allowance will arise.

An entity purchases an asset, which is eligible for tax depreciation, on 1 January 20X0 for $5,000.  The asset is sold for $2,200 on 31 December 20X2.

For the year ended 31 December 20X2 there is a:  --chargeallowance