These are available in the case of operations which involve both deductible and non-deductible transactions.

If total receipts from operations subject to TCA assessment divided by total receipts from all operations.

  • Is more than 80% the deduction is 100%
  • Is between 20% and 80%, the deduction is 50%
  • Is less than 20% the deduction is 5%

The pro-rata calculation has to be verified by the Tax Authorities before deductions are accepted or appropriate adjustments are made to the provisional calculations made by the tax payer, as necessary.

TCA levied on fixed assets is deductible within the above pro-rata limits. However, account can be taken of district areas of activity so that if the fixed asset is used wholly for taxable activity, the TCA levied on it is fully deductible. Appropriate adjustments are made when a fixed asset on which TCA is deducted is subsequently sold.

NOTE: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought for specifics.

For further information contact Mr Nico Halle, Tel: +237 42 64 79 or Fax: +237 43 26 34 or enter text search 'Nico Halle Law Firm' and 'Mondaq Business Briefing'.