Article 99 grants the Tax Authority oversight over how a total sale or insurance sum is divided among various assets. The Authority may approve the apportionment agreed upon between the former owner and the new owner (or insurer). However, if the Authority does not approve the private agreement, it has the legal power to perform its own apportionment of the total sum across the different items. This prevents taxpayers from arbitrarily assigning high values to non-depreciable assets and low values to depreciable ones (or vice versa) to create an artificial tax advantage during a bulk disposal.
Part 3 - Chargeability to Tax
Chapter 3 - Depreciation of Capital Assets
Section 6 - Provisions Concerning the Disposal of Capital Assets
Article 99
[GTL Notes: Regulatory Approval of Asset Value Distribution]
The following provisions shall be considered in the case referred to in Clause (1) of the foregoing Article 98:
The Authority may approve the agreement between the parties - former and new owners - or the former owner and the insurer, for the apportionment of the sum referred to in that Clause, between the various items of the assets.
If the agreement is not approved under the foregoing Paragraph, the Authority may apportion the sum referred to in Paragraph (1) of the foregoing Article 98 between the various items of the assets.
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