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Ans 11. DA-Buildings

Ans 11. DA-Buildings - BUSI 0018 Hong Kong Taxation...

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TA_U11_DA_Bldgs 1 BUSI 0018 – Hong Kong Taxation Tutorial Questions Unit 11 – Depreciation Allowance: Buildings Answer 26(a) Better Investment Limited, which holds the relevant interest of the building, can claim industrial building allowance if the usage of the individual floors can qualify as an industrial building as defined in S.40(1). Under S.40(1), industrial building or structure means, among other things, any building or structure used for the purposes of a trade which consists of the manufacture of goods or materials or the subjection of goods or materials to any process. In the present case: Ground floor The owner is not entitled to any industrial building allowance because the repairing activities were only incidental to the car distributing business of the tenant. First floor The owner is entitled to industrial building allowance as goods were manufactured in the premises. In addition, any building or structure used for the purposes of a trade which consists of the storage of goods or materials is also treated as an industrial building or structure, given that the said goods or materials are to be used in the manufacture or process, or the goods and materials are newly arrived into Hong Kong. In addition, it must be noted that the trade itself
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