Other workpapers

Business related costs workpaper

The Business related costs workpaper is designed to analyse section 40-880 costs. On this workpaper, you can add back accounting amortisation, non-deductible business-related costs expensed, and business-related costs expensed but capitalised for tax. You can also claim the tax deduction for section 40-880 costs.
The workpaper is divided into four sections:
  1. Amounts treated as business-related costs for accounting that have been expensed to P&L
  2. Amounts treated as business-related costs for accounting that have been capitalised to the balance sheet,
  3. Amounts treated as section 40-880 costs for tax, and
  4. Statement of taxable income adjustments.
All amounts treated as borrowing costs for accounting must be analysed in either one or the other of the accounting values sections.

Accounting values - expensed to P&L

This section displays the various sources of accounting borrowing costs expensed to P&L, so that they can be further analysed. These could be either of the following:
  • Expenses mapped directly to the
    Borrowing costs included in P&L
     income statement line item
  • Expenses that were mapped or added to the Consulting Expenses, Legal Fees, or other similar Income Statement workpaper, but were allocated in that workpaper as borrowing costs. Those amounts will then be pushed from that workpaper to the Borrowing Costs workpaper to be analysed further.
The total amounts expensed from each of these sources appears in the
Amount
column. You can then manually allocate these amounts, or portions of the amounts, to the following:
  • Immediately deductible (column E). No tax adjustment is required, as this is already expensed.
  • Never deductible (column F). Becomes tax add back – see row 41.
  • Capitalised subject to tax rules (column G). Becomes tax add back – see row 40.

Accounting values - capitalised to balance sheet

This section shows the accounting borrowing costs that were capitalised to the balance sheet. Any rows relating to amounts brought forward from the prior year are shown. Additions for the year should also be added manually.
Complete the
Original cost
,
Start date
, and
Write-off period (years)
 fields. The amortisation/deduction claimed (col L) and the closing balance (column O) will be automatically calculated. You can also manually enter
Closing balance per GL
 (column P) to allow a variance check (column Q), but this is optional.
Amortisation/deduction claimed
 (column L), net of any
Adjustments/write-off
(column M) and
Transfers in/(out)
 (columnl N), results in a tax add-back (see row 39).

Tax values

In this block, add and analyse any amounts treated as borrowing costs for tax.
At a minimum, any amounts in the
Accounting values – expensed to P&L
 section that were allocated to the
Capitalised subject to tax rules
 column (column G) should be added as a current year addition to this block.
Any rows relating to opening balances brought forward from the prior year appear automatically.
Complete the
Original cost
,
Start date
,
Opening balance
, and
Write-off period (years)
 fields. You can also select
Expensed to P&L
 or
Capitalised to balance sheet
(column C) to categorise the accounting treatment for each row. The amortisation/deduction claimed and closing balance are calculated automatically.
The amortisation/deduction claimed, net of adjustments and transfers, will result in a tax deduction (see row 44).
In the
Category
 column, selecting a category for a row does not impact the calculation of values. but allows you to sort and view the rows in their respective categories.

This article applies to:

  • Product: ONESOURCE Corporate Tax