On July 21st ,2020, Bac Ninh Tax Department has issued Official Letter No. 2332/CT-TTHT providing guidance on dossiers, procedures, method of accounting when dismantling a part of fixed assets as follows:
If the fixed asset is the storehouse (including small work item: Storehouse, locker house, toilet, resting house, garage,..) that is being administered by the company under a fixed asset code, such asset will not be set apart for monitoring. At present, due to the need for upgrading the asset to be suitable with the situation of the user demand, the company wants to pull down the garage to rebuild it with a more modern one, thereby the dismantling will decrease the storehouse’s historical cost of the fixed asset. The company must fully implement the procedures as stipulated (decision to dismantle the garage in writing, decision/record of asset liquidation, …); determine the remaining value of the asset, income from the sale of dismantled property (if any). On the basis of the relevant documents, the accountant shall prepare and complete the fixed asset management dossiers in accordance with legal regulations.
Accounting for the decrease in the historical cost of fixed assets; income from asset liquidation (if any) shall comply with the provisions of Clause 3.2, Article 35 of Circular 200/2014/TT-BTC dated December 22nd, 2014 issued by the Ministry of Finance “on guidelines for accounting policies for enterprises”.
