Capital Goods Adjustment and Depreciation
Capital Goods Adjustment and Depreciation
Q. Can I use the purchase price of a capital item acquired prior to me becoming a registered person as a basis for making initial input tax claim and subsequent adjustments?
A. No, the book value of a capital item on the date the owner becomes a registered person will be the basis for calculating input tax and adjustments.
Example: ABC Sdn. Bhd., a mixed supplier, bought equipment on 3 July 2016 for RM200,000.00 and the company only becomes a registered person on 1 February 2018. On the day, the company becomes a registered person, the book value of the equipment has depreciated to RM120,000. Hence, the value to be used for calculating input tax and adjustments on the equipment is RM 120,000.
16_CAPITAL_GOODS_ACQUIRED
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