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Determination of the Value of Increased Exports for P.U. (A) 161/2019, 162/2019 and 163/2019


P.U. (A) 161/2019, 162/2019 and 163/2019 are Income tax exemption orders for companies achieving an increase in export sales (gazetted on 7 June 2019).


Determination of the Value of Increased Exports was stated in Paragraph 5(1)(b) of P.U. (A) 161/2019. 162/2019 and 163/2019, respectively, as below.


In determining the value of increased exports, however, where the basis periods for the two comparative years of assessment of the qualifying company are not for periods of 12 months ending on the same date, the average free-on-board ["FOB"] value of export sales of both basis periods shall he used.


We are now providing illustrations for simple understanding purposes, and these methods of computation were confirmed by the Inland Revenue Board via a letter dated 4 Jun 2020.

Illustration

Year of Assessment 2019

The calculation for comparison purposes for the Year of Assessment 2019:-

Therefore, for comparison purposes, the Free on Board (FOB) value for both assessment years should be divided as follows:-


Year of Assessment 2020

The calculation for comparison purposes for the Year of Assessment 2020:-

Therefore, for comparison purposes, the Free on Board (FOB) value for both assessment years should be divided as follows:-

Year of Assessment 2021

For the assessment year 2021, the comparison can be done directly without involving pro-rated months if the basic period for the complete assessment year 2021 consists of 12 months and ends on September 30, 2021.

References:-

P.U. (A) 161/2019

1. Income Tax Exemption (No. 5) Order 2019 (PU (A) 161_2019)
.pdf
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P.U. (A) 162/2019

1. Income Tax Exemption (No. 6) Order 2019 (PU (A) 162_2019)
.pdf
Download PDF • 612KB

P.U. (A) 163/2019

1. Income Tax Exemption (No. 7) Order 2019 (PU (A) 163_2019)
.pdf
Download PDF • 608KB

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