Considerations for Retiring Assets
When an asset is no longer in service because, for example, it was stolen, lost, damaged, sold, or returned, you retire the asset.
You can retire an asset completely if the entire asset is no longer in service or retire only part of an asset if only part of it's no longer in service.
Retirement Methods
Retire assets using one of these methods:
Method |
Description |
Rules |
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Full retirement |
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Partial retirement |
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Retirement Types
Retire assets using one of these three retirement types:
Type |
Description |
Rules |
---|---|---|
Unit retirement |
Retire assets by unit, either all units or some units of a multiple-unit asset. The retirement process automatically calculates the cost retired for each unit retired. |
Not allowed in tax books or for CIP assets. |
Cost retirement |
Retire assets by cost. The units remain unchanged and the retirement process spreads the retired cost evenly among the units. |
Allowed in both corporate and tax books. |
Source line retirement |
Retire an asset that was imported as a source line by retiring the asset cost based on the source line. |
Allowed for both partial and full retirements. |
Here are some additional points to keep in mind:
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For multiple partial retirements on the same asset within a period, run the Calculate Gains and Losses process between transactions.
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For partially retired units of production assets, manually adjust the capacity to reflect the portion retired.