Your biggest loss

[Shaun_Siddall]

Its an asset that has been depreciated therefore in operation. Your residual value needs to be determined every year and will eventually become zero or your depreciation rate needs to be reassessed. So as long as your asset is in use and you are testing your residual annually DT should be raised on your intention to recover through use? Presuming the Tax Base is zero your recoupment will be taxed up to cost at the normal tax rate? What does your intention have to do with it if DT HAS to be raised? What could effect your rate 1) Raised at the standard tax rate 2) CGT? So regardless of your intention 30% to cost 15% above cost. If the asset gets classified as held for sale the implications are different. OMO - 2006 board exams. Your example would clearly effect revaluation reserves and DT from that as your intention is key there.

[ABuzz]

If we are just talking about the last 3 months, I haven't made any losses, had a good run. But go a month or two back from that and I'm still sitting with AEA I bought at R 2,40, now at R 1,35. Anyway have been stocking up on the falling price, so it is bringing my average price down, but it still burns me to have taken such a knock on my 1st purchase. I did buy it as a 3 - 5 year investment though, so I shouldn't be getting too stressed yet.

[Preston]

If the asset has a resiual value at the end of its useful life..there is an implied intention to sell. Deff Tax is raised at 14.5%

[Shaun_Siddall]

How do work the asset off your BS? Up to cost you pay tax at 29% on the recoupment - realise the asset on recoupment. You wont be reflecting the true position and on sale another journal will have to passed inflating the tax charge through the accounts? What you have said is very true for FV reserves when your intention changes you are working above the cost line? OMO.

[#5]

i feel for u Mkadir , thats a big loss - thanks for posting , that can be a lesson to all of us here.