Where there is a part realisation of an intangible asset, the amount deducted for tax purposes from realisation proceeds is a proportion only of the tax written down value or the cost of the asset, as the case may be1. The amount deducted is adjusted in proportion to the amount of the accounting value immediately before the realisation that is attributable to amount of the accounting value realised. Therefore the proportion that is applied to either tax written down value or cost is2:
(AVB – AVA) / AVB
where:
- Ìý
•ÌýÌýÌýÌý AVA is the accounting value immediately after the realisation
- Ìý
•ÌýÌýÌýÌý AVB is the accounting value immediately before the realisation
Accounting value means the net book value or carrying value of the
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