How does this work?Yes, good point on being taxed if selling above depreciated value. That's why it's important to choose the right method of depreciation that suits your situation
Lets say you buy a company car and make it before eofy. Purchase price 85k.
Can still use temp fully expensing depreciation i.e. 64k. Residual value = 21k
Lets then say in few years time, the car is sold for 41k.
For income tax perspective, does it mean that the company need to pay income tax of 20k (41k-21k) ?
If the car is sold for less than the residual value, e.g. 15k, no tax need to be paid?