Understanding Fixed-Asset Tax Allowances and Recoupments

This page explains how Beam Machine fixed-asset screens support South African tax work and why the asset register is not the same thing as a finished tax-allowance schedule.

Product: Beam Machine
Module: Fixed Assets and Tax
Role: Accountant, Asset Controller, Tax Preparer, Reviewer
Difficulty: Intermediate
Time: 10 minutes
Last Updated: 2026-03-10
Version: Current Beam Machine app build in this repo

Before You Start

• You need access to Fixed Assets.
• The asset register should already be current.
• You should know the difference between accounting depreciation and tax allowances.

What is this page?

This is the fixed-asset tax bridge page.

Beam Machine gives you live asset screens for:

• Asset Register
• Depreciation Schedule
• Asset Disposals
• Fixed Asset Reconciliation

Those screens are valuable for tax work, but they do not mean the tax treatment is fully automated. In South Africa, tax allowances, scrapping deductions, and recoupments can differ from accounting depreciation and book value.

When do you use this?

Use this page when:

• the company-tax pack needs asset support,
• the tax reviewer is checking whether depreciation must be adjusted,
• or an asset disposal or scrapping event affects current tax.

If you skip this bridge, the business can end up claiming book depreciation as if it were tax law.

Where do you find the supporting BM screens?

Primary paths:

• Finance -> Fixed Assets -> Register
• Finance -> Fixed Assets -> Depreciation
• Finance -> Fixed Assets -> Disposals
• Finance -> Fixed Assets -> Reconciliation

How to use Beam Machine asset data for tax support

1. Open Fixed Assets.
2. Start in Register and confirm the asset exists with the correct:
   • cost,
   • acquisition date,
   • depreciation method,
   • tax class,
   • location,
   • and status.
3. Open Depreciation and review the current depreciation movement.
4. Open Disposals if the asset was sold, scrapped, or written off.
5. Open Reconciliation and confirm the asset book ties back to the register.

✅ Checkpoint: You should now have a clean BM asset trail to support tax review.

6. Build the tax-allowance working paper outside the app if the entity needs South African tax-specific treatment.
7. Reconcile any difference between book depreciation and tax allowance before finalizing company-tax numbers.
8. Review disposal proceeds separately to determine whether a recoupment, scrapping deduction, or capital gain/loss issue exists.

What users often get wrong

Accounting depreciation is not automatically the tax deduction

The Depreciation Schedule route shows accounting-style depreciation support. South African tax law may instead require a specific allowance basis or write-off period. If you claim the accounting charge blindly, your tax computation can be wrong.

Net book value is not the final tax value

An asset can look fully sensible in the BM register and still need a tax-value adjustment in the company-tax file.

Disposal profit in accounting is not the same thing as tax recoupment

When an asset is disposed, the tax result can involve recoupment, capital treatment, or scrapping logic depending on the facts. The BM disposal record supports the review, but it does not remove the tax analysis.

What Beam Machine does and does not do today

• Beam Machine does give you a controlled asset record, depreciation view, disposal register, and reconciliation route.
• Beam Machine does improve the evidence trail for tax and audit support.
• Beam Machine does not currently prove a full South African capital-allowance engine, automatic recoupment calculation, or complete tax-written-down-value schedule in the live UI.

Common Questions & Issues

"The depreciation number in BM should go straight into tax"

Why this happens: Users assume one asset number serves every purpose.

Fix: Reconcile accounting depreciation to tax-allowance treatment before final filing work.

"The disposal is recorded, so the tax result is finished"

Why this happens: The operational record looks complete.

Fix: Review proceeds, tax value, and recoupment or capital-treatment consequences separately.

"Why do I still need a working paper if the asset register is clean?"

Why this happens: A clean register solves the source-data problem, not the tax-law problem.

Fix: Use BM as your evidence base, then complete the tax bridge outside the route.

What's Next

• Read 11-understanding-company-tax-adjustments-and-assessed-losses.md if the asset issue affects ITR14 support.
• Read ../modules/10-working-in-fixed-assets.md for the wider asset workflow.

Related Pages

• 03-preparing-itr14-and-emp201.md
• 09-reviewing-tax-provisions.md
• ../tasks/11-adding-a-fixed-asset.md
• ../14-asset-rental-stock-and-fleet.md

SA Compliance Reference

• South African tax treatment for assets can involve wear-and-tear allowances, accelerated allowances, recoupments, and scrapping deductions depending on the asset type and facts.
• Assets must be supported by acquisition records, use-in-trade evidence, and disposal evidence.
• Keep the detailed tax-written-down-value schedule and technical tax analysis outside the app unless your environment has separately delivered that capability.

Still Stuck?

• If the asset book is wrong, fix the register first.
• If the tax bridge is wrong, do not try to force the answer out of the depreciation page.
• Contact support: support@veva.co.za

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