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Enacting Formula

 
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On 24/10/2014, you requested the version as published on or before 24/10/2014.
Amendment of section 19A
24.  Section 19A of the principal Act is amended —
(a)
by inserting, immediately after subsection (2), the following subsections:
(2A)  Where a person proves to the satisfaction of the Comptroller that he has incurred capital expenditure during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive) on the provision of one or more prescribed automation equipment for the purposes of a trade, profession or business carried on by him, there shall be allowed on due claim in respect of all his trades, professions and businesses, in addition to any allowance under subsection (2), an allowance of 150% of the lower of the capital expenditure incurred on the provision of the prescribed automation equipment and $300,000.
(2B)  For the year of assessment 2011 and the year of assessment 2012, instead of the allowance under subsection (2A) in respect of each year of assessment, a person shall be allowed an allowance computed in accordance with the formula
A x 150%,
where A is —
(a)
for the year of assessment 2011, the lower of —
(i)
the capital expenditure incurred during the basis period for that year of assessment on the provision of one or more prescribed automation equipment; and
(ii)
$600,000; and
(b)
for the year of assessment 2012, the lower of —
(i)
the capital expenditure incurred during the basis period for that year of assessment on the provision of one or more prescribed automation equipment; and
(ii)
the balance after deducting from $600,000 the lower of the amounts specified in paragraph (a)(i) and (ii).
(2C)  Where a person proves to the satisfaction of the Comptroller that he has during or after the basis period for the year of assessment 2011 incurred capital expenditure by way of making one or more instalment payments under a hire-purchase agreement or agreements to acquire one or more prescribed automation equipment for the purposes of a trade, business or profession carried on by him, that is or are signed during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive), and he makes a claim for an allowance under subsection (2A) or (2B), those subsections shall apply with the following modifications:
(a)
a reference to the capital expenditure incurred on the provision of one or more prescribed automation equipment during the basis period for a year of assessment, being the basis period in which the agreement or agreements is or are signed, is a reference to the aggregate of —
(i)
the price or prices (including capital expenditure incurred on alterations to an existing building incidental to the installation of the equipment but excluding any finance charges) at which he might have purchased the equipment or all the equipment that is the subject of the hire-purchase agreement or agreements for cash at the time of the signing of the agreement or agreements; and
(ii)
the capital expenditure incurred on the provision of any other prescribed automation equipment for the purposes of his trade, profession or business during that basis period;
(b)
a reference to the capital expenditure incurred on the provision of one or more prescribed automation equipment during the basis period for a year of assessment excludes the amount of any instalment paid or deposit made by him under that agreement or any of those agreements during the basis period; and
(c)
the allowance referred to in subsection (2A) or (2B) in respect of each equipment that is the subject of a hire-purchase agreement shall be made to the person for the year of assessment in respect of each basis period during which he paid an instalment or instalments or made a deposit or deposits under the agreement, in the proportion which the total amount of the instalment or instalments paid, and deposit or deposits made, during that basis period for that equipment bears to the total amount of all instalments and deposits under the agreement for that equipment.
(2D)  For the purposes of subsections (2A) and (2B), where an individual carrying on a trade, profession or business through 2 or more firms (excluding partnerships) has incurred capital expenditure during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive) on the provision of one or more prescribed automation equipment in respect of such firms for the purposes of his trade, profession or business, the allowance that may be allowed to him for that expenditure in respect of all his trades, professions and businesses shall not exceed the amount computed in accordance with subsection (2A) or, in the case of the year of assessment 2011 and the year of assessment 2012, the amounts computed in accordance with subsection (2B)(a) and (b), respectively.
(2E)  For the purposes of subsections (2A) and (2B), where a partnership carrying on a trade, profession or business has incurred capital expenditure during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive) on the provision of one or more prescribed automation equipment for the purposes of its trade, profession or business, the aggregate of the allowances that may be allowed to all the partners of the partnership for that expenditure in respect of all the trades, professions and businesses of the partnership shall not exceed the amount computed in accordance with subsection (2A) or, in the case of the year of assessment 2011 and the year of assessment 2012, the amounts computed in accordance with subsection (2B)(a) and (b), respectively.
(2F)  Notwithstanding subsections (2A) and (2B), where a person has incurred capital expenditure on the provision of any prescribed automation equipment for the purpose of leasing such equipment, no allowance under those subsections shall be made to him in respect of such expenditure.
(2G)  Notwithstanding subsections (2A) and (2B) —
(a)
where a person who has incurred capital expenditure on the provision of any prescribed automation equipment elects to claim allowances in respect of such equipment under subsection (1) or (1B) or section 19, the allowances under subsections (2A) and (2B) shall be written down over the number of years of working life of the equipment as specified in the Sixth Schedule in the case of section 19, over 3 years in the case of subsection (1) or over 2 years in the case of subsection (1B); and
(b)
if the person referred to in paragraph (a) sells, transfers or assigns the prescribed automation equipment after one year from the provision of such equipment, any allowance in respect of such equipment under subsections (2A) and (2B) remaining unallowed at the time of the sale, transfer or assignment shall be allowed to him for the year of assessment relating to the basis period in which the sale, transfer or assignment occurs.
(2H)  Where any allowance has been made to any person under subsection (2A) or (2B) in respect of any prescribed automation equipment and the person sells, transfers, assigns or leases the prescribed automation equipment within the period of one year from the provision of such equipment —
(a)
no allowance in respect of such equipment shall be made to that person under subsections (2A) and (2B) for the year of assessment relating to the basis period in which the sale, transfer, assignment or lease occurs and for any subsequent year of assessment; and
(b)
any allowance made under subsection (2A) or (2B) shall be brought to charge as if the allowances were not made, and be deemed as income for the year of assessment relating to the basis period in which the sale, transfer, assignment or lease occurs.
(2I)  No allowance under subsections (2A) and (2B) shall be made to any person in respect of any amount of capital expenditure incurred on the provision of prescribed automation equipment for which an investment allowance has been claimed under Part X of the Economic Expansion Incentives (Relief from Income Tax) Act (Cap. 86).
(2J)  No allowance under subsections (2A) and (2B) shall be made to any person in respect of any prescribed automation equipment —
(b)
for which an allowance under this section or section 19 has been previously made to that person.
(2K)  No allowance under subsections (2A) and (2B) shall be made to any person in respect of any instalment paid by him under any hire-purchase agreement to acquire any prescribed automation equipment that is signed before the basis period for the year of assessment 2011.”;
(b)
by deleting the words “(other than subsections (2) to (10C))” in subsection (14B);
(c)
by deleting “2013” in subsection (14B) and substituting “2015”;
(d)
by deleting paragraph (a) of subsection (14C) and substituting the following paragraph:
(a)
a reference to the amount of the expenditure or payments (after deducting any amount in respect of which an election for a cash payout has been made under section 37I) is a reference to the amount of the allowance, after deducting any amount in respect of which an election for a cash payout has been made under section 37I;”;
(e)
by inserting, immediately after the word “allowance” in the definition of “A” in subsection (14C)(c), the words “, after deducting any amount in respect of which an election for a cash payout has been made under section 37I,”;
(f)
by deleting the words “in any office or factory within the meaning of section 5 of the Workplace Safety and Health Act (Cap. 354A)” in the definition of “automation equipment” in subsection (15);
(g)
by inserting, immediately after subsection (15), the following subsection:
(16)  In subsections (2A) to (2G) and (2I), a reference to capital expenditure incurred on the provision of prescribed automation equipment excludes any such expenditure to the extent that it is subsidised by grants or subsidies from the Government or a statutory board.”; and
(h)
by deleting the word “office” in the section heading.