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Fixed Assets


Need some help on capital allowances.

Take an example of a machinery that costs $100,000 bought in April, year 2002. Capital allowance is based on a full year's depreciation regardless of the period the asset is purchased.

This asset bears an initial allowance of 20% on cost and annual allowance of 12% on cost. It also qualifies for re-investment allowance of 60% of cost.

Both the initial allowance and re-investment is fully taken up in the 1st year.

Annual allowance will start from the 1st year until fully allowed.

In Yr 2002, IA = $20,000; RA= $60,000 and AA = $12,000
Subsequents years, only AA @ $12,000 per annum.

IA + AA = Cost of Assets
RA = Additional allowance on top of the Cost of Asset.

Since for managment purposes, capital allowances is calculated monthly, both IA & RA is fully take up in the 1st month of depreciation.

The annual allowance for Year2002 will be apportioned out over 9 months ( bought in April).

What would be the best way to set up the depreciation?

I'm using D1 as my tax ledger.
I'm wondering whether I can define a depreciation so that only D1 ledger will suffice. But I think this is impossible.

It would be easier to have 2 ledgers e.g D1 to take care of IA and RA and D2 to take care of AA.

Would appreciate any comments or suggestions.