In an interpretation note of November 2009, SARS provided a schedule of depreciation write-off periods applicable to all types of machinery and equipment.
Interpretation Note No 47 (Issue 2), dated 11 November 2009 contains information regarding depreciation allowances as set out in Section 11(e) of the Income Tax Act. The Note is applicable to assets that have been brought into use during any year of assessment commencing on or after 1 March 2009, and prescribes the write-off periods acceptable to SARS. It deals with all types of machinery and equipment, from adding machines to X-ray equipment.
What makes this interpretation note significant is the fact that it qualifies as a binding general ruling made under section 76P of the Income Tax Act in as far as it relates to:
- the determination of the value of an asset for purposes of section 11(e); and
- the determination of the amount that will qualify as an allowance.
For more information please contact Sonja Frank at the Stellenbosch office, tel. 021 882 8140 or e-mail Sonja@exceed.co.za.