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Amendment of section 61 of Principal Act (apportionment for dual-use inputs)
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46. Section 61 of the Principal Act is amended—
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(a) by substituting the following for subsections (4) and (5):
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“(4) Subject to subsection (5), the proportion of tax deductible by an accountable person in a taxable period shall be calculated on the basis of the ratio which the amount of the person’s tax-exclusive turnover from deductible supplies or activities in the accounting year in which that taxable period ends bears to the person’s tax-exclusive turnover from total supplies and activities in that accounting year.
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(5) Where the proportion of tax deductible calculated in accordance with subsection (4) does not—
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(a) correctly reflect the extent to which the dual-use inputs are used for the purposes of the person’s deductible supplies or activities, or
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(b) have due regard to the range of the person’s total supplies and activities,
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the accountable person shall use any other basis which results in a proportion of tax deductible which—
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(i) correctly reflects the extent to which the dual-use inputs are used for the purposes of the person’s deductible supplies or activities, and
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(ii) has due regard to the range of the person’s total supplies and activities.”,
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and
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(b) in subsection (6) by substituting “this section,” for “subsection (4),”.
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