A company purchases new manufacturing machinery to be used directly in a process of manufacture in South Africa. The tax manager wants to maximize the speed of tax relief while remaining compliant. Which treatment is most appropriate?

Question

A   company   purchases   new   manufacturing   machinery   to   be   used   directly   in   a   process   of   manufacture   in   South   Africa.   The   tax   manager   wants   to   maximize   the   speed   of   tax   relief   while   remaining   compliant.   Which   treatment   is   most   appropriate?

Accepted Answer

Apply   the   manufacturing   asset   allowance   at   the   prescribed   write-off   rate   for   qualifying   new   and   unused   machinery.

Answer

Claim   the   full   cost   as   an   immediate   deduction   in   the   year   of   purchase

Answer

Disallow   any   deduction   until   the   machinery   is   sold

Answer

Claim   wear-and-tear   under   the   general   allowance   system   over   the   asset’s   useful   life   only

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A company purchases new manufacturing machinery to be used dir...

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