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Selling a low value pool asset

Australia only

To sell a low value pool asset
  1. Open the Assets Listing page. See Opening an asset year.
  2. Select the asset to be sold. The row containing the selected asset will be highlighted.
  3. Click Sell on the TASKS bar. The Sell Asset window opens displaying the Asset code and Asset name of the selected asset.
    The sell asset window in the Taxation tab with the button Sell circled in the Tasks panel.
  4. Enter the Disposal date of the low value pool asset. The Disposal date must be within the current year. Enter the Disposal date in the format dd/mm/yyyy or select it from the drop-down calendar. You can also select Today’s date from the drop-down calendar. The default Disposal date is the Year end date for the opened year. The Current closing w.d.v is a read only field displaying the closing written down value immediately prior to selling the asset, i.e., the taxable value less the full year’s depreciation.
  5. Enter the Termination value. The termination value is the amount received for the asset when it was sold or disposed of. The default value is 0.00. This is a numeric field of a maximum of 27 digits including 2 decimal places. The Taxable termination value is a calculated field and you cannot enter a value.

    Taxable termination value = Termination value x (1 - Average private use %)

  6. Select the Calculate capital gain/loss checkbox, if required. The Calculate capital gain/ loss checkbox will only be enabled if there is a private use % for the asset.

    When an asset, which has been partly used for taxable purposes, is disposed of, a capital gain or loss may arise. Where there is a difference between the asset's cost and its termination value, a proportion of this difference is attributable to estimated non-taxable use of the asset that is treated as a capital gain or loss under the capital gain provisions. The shareholder will be charged the capital gains tax on their tax return (or receive a credit for capital loss). This can be different for each asset of the pool.

    If the Calculate capital gain/loss checkbox is selected the capital gain is calculated as (Termination value - cost) x Private use %, the Capital gain/loss field is a read-only field as the value is calculated.

    As a capital gain/loss occurs only for a sale (not very often), it is displayed in the Sell Asset window rather than in the Edit Asset window. The Shareholder’s current/drawings account will be charged the capital gain tax on their tax return and a journal is created.

    The Capital gain tax is different for each asset depending on the shareholder using the asset.

    If the capital gain is not be applied, deselect the Calculate capital gain/loss checkbox. When the Calculate capital gain/loss checkbox is unchecked:

    • All the fields in Shareholder’s capital gain/loss section will be disabled.

    • No journal is created.

  7. Click OK. The database is updated with the sold low value pool asset. On the Assets Listing page, the entry line for the sold asset will be greyed out but the asset will still be visible.

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