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<ManualTopic ID="/baanerp/tf/onlinemanual/000403" xml:lang="en">
   <Header>
      <Title>The Adjustment Period</Title>
   </Header>
   <AimSection>
      <Paragraph>An adjustment period refers to a fixed period of time,
		consisting of intervals, during which the proportional taxable usage of a
		capital item is re-evaluated.</Paragraph>
   </AimSection>
   <GeneralSection>
      <Paragraph>For land and building, the adjustment period consists of 10
		intervals (inclusive of both, the first and the final intervals) and for all
		other capital items, the adjustment period can consist of only 5
		intervals.</Paragraph>
   </GeneralSection>
   <GeneralSection>
      <SectionTitle>Categories of the time interval</SectionTitle>
      <Paragraph>According to the CGA, the intervals in which the re-evaluation
		and adjustments must be made, can be categorized as 'first', 'subsequent' and
		'final' interval.</Paragraph>
      <Paragraph>The 'first' interval for a capital item commences from the date
		when the capital item is imported, acquired or supplied. According to the CGA,
		you must not make adjustments to the first interval.</Paragraph>
      <Paragraph>In the 'subsequent' and the 'final' time interval, adjustments
		are made to the initial input tax claim when the proportional use of the item,
		fluctuates in each interval. If the proportional taxable use decreases in the
		subsequent or the final time intervals (as compared to the first time
		interval), a certain percentage of input tax that is claimed initially, must be
		paid back to RMCD. Conversely, if the taxable use of the capital item
		increases, the additional amount of the input tax can be claimed on the capital
		item. According to the CGA, you must not make any changes after the adjustment
		for the final time interval is made.</Paragraph>
      <Paragraph>There are two methods to determine the additional input tax
		incurred on a capital item after the first time interval. The two options
		are:</Paragraph>
      <List>
         <ListItemHead>Combined adjustments</ListItemHead>
         <ListItem>This approach involves combining the adjustment calculations
		  for the remaining time intervals. Each time an additional input tax is
		  incurred, the base percentage must be re-evaluated and used to measure the
		  additional input tax for the next interval. The base percentage can be
		  calculated by determining the percentage of input tax that has been reclaimed
		  for the intervals that expired.</ListItem>
         <ListItemHead>Parallel adjustments</ListItemHead>
         <ListItem>This approach involves separate, but simultaneous calculation
		  adjustments for the remaining time intervals.</ListItem>
      </List>
   </GeneralSection>
</ManualTopic>