Class 4-Fixed Asset ( Tax Depreciation )

Lesson Summary-Fixed Asset class 4 under Cambodia Tax

• -Fixed Asset Class 4 are other tangible assets (except fixed asset class 1,2 and 3). For example , fixed asset class 4  included generator, machinery, sewing machine etc.
• -Depreciation rate is 20%.
• -Depreciation Expense is used reducing/declining balance.

Example 1

ABC Company has the following fixed assets:

• -14 May 2019, company bought a Generator of $2,200 (included VAT).
• -15 July 2019, company bought production machinery for $55,000 (included VAT).

Required

Calculate tax depreciation expense.

Answer

Deprecation expense =(2,200+55,000) /1.1 x 20%=$52,000 x 20%=$10,400.

Note:

• -Cost of fixed asset excluded VAT because VAT input can be claimed.
• -Full year deprecation expense in year bought, so even February, March or December, Company still depreciated full deprecation during year.