BLM80510 - Calculating the income amount: Calculating the income amount: outline

CTA2010/S399

»Ê¹ÚÌåÓýapp income amount is calculated in two stages.

»Ê¹ÚÌåÓýapp first stage is to calculate the difference between

  • the accounts value of the plant or machinery (PM), and
  • the tax written down value of the plant or machinery (TWDV)

on the relevant day.

»Ê¹ÚÌåÓýapp formula PM - TWDV gives the ‘basic amountâ€� of the income. »Ê¹ÚÌåÓýapp amount is nil when PM is less than TWDV. Further guidance is at BLM80515 onwards.

»Ê¹ÚÌåÓýapp second stage is to adjust the basic amount so that if (say) 50% of the shares in a lessor company are sold, the charge is half the basic amount.