Clause 25

by deleting subsections (1) to (6) and substituting the following subsections:“(1) Subject to this section, for the purpose of ascertaining the income of a person carrying on a trade or business during the basis period for the year of assessment 2011 or the year of assessment 2012, there shall be allowed in respect of all his trades and businesses, in addition to the deduction under section 14, a deduction for the expenditure incurred for the purposes of those trades and businesses on the leasing of one or more PIC automation equipment under a qualifying lease or leases, computed in accordance with the following formula:where A is —

for the year of assessment 2011, the lower of the following:

such expenditure incurred during the basis period for that year of assessment; and

$800,000; and

for the year of assessment 2012, the lower of the following:

such expenditure incurred during the basis period for that year of assessment; and

the balance after deducting from $800,000 the lower of the amounts specified in paragraph (a)(i) and (ii).(2) Subject to this section, for the purpose of ascertaining the income of a person carrying on a trade or business during the basis period for the year of assessment 2013, the year of assessment 2014 or the year of assessment 2015, there shall be allowed in respect of all his trades and businesses, in addition to the deduction allowed under section 14, a deduction for the expenditure incurred for the purposes of those trades and businesses on the leasing of one or more PIC automation equipment under a qualifying lease or leases, computed in accordance with the following formula:where A is —

for the year of assessment 2013, the lower of the following:

such expenditure incurred during the basis period for that year of assessment; and

$1,200,000;

for the year of assessment 2014, the lower of the following:

such expenditure incurred during the basis period for that year of assessment; and

the balance after deducting from $1,200,000 the lower of the amounts specified in paragraph (a)(i) and (ii); and

for the year of assessment 2015, the lower of the following:

such expenditure incurred during the basis period for that year of assessment; and

the balance after deducting from $1,200,000 the lower of the amounts specified in paragraph (a)(i) and (ii), and the lower of the amounts specified in paragraph (b)(i) and (ii).(3) No deduction shall be allowed to a person under this section in respect of —

any expenditure which is not allowed as a deduction under section 14; or

any expenditure incurred during the basis period for a year of assessment on the leasing of any PIC automation equipment under a qualifying lease where —

the equipment is sub-leased to another person during that basis period; or

an allowance has been previously made to that person under section 19 or 19A in respect of the equipment.(4) Where a person has incurred expenditure on both the leasing under a qualifying lease and the provision of one or more PIC automation equipment during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive), the aggregate of the deduction under subsection (1) or (2) and the allowance under section 19A(2A) or (2B) in respect of all such expenditure shall not exceed —

in the case of the year of assessment 2011, 300% of the lower of the following:

the aggregate of all such expenditure; and

$800,000;

in the case of the year of assessment 2012, 300% of the lower of the following:

the aggregate of all such expenditure; and

the balance after deducting from $800,000 the lower of the amounts specified in paragraph (a)(i) and (ii);

in the case of the year of assessment 2013, 300% of the lower of the following:

the aggregate of all such expenditure; and

$1,200,000;

in the case of the year of assessment 2014, 300% of the lower of the following:

the aggregate of all such expenditure; and

the balance after deducting from $1,200,000 the lower of the amounts specified in paragraph (c)(i) and (ii); and

in the case of the year of assessment 2015, 300% of the lower of the following:

the aggregate of all such expenditure; and

the balance after deducting from $1,200,000 the lower of the amounts specified in paragraph (c)(i) and (ii), and the lower of the amounts specified in paragraph (d)(i) and (ii).(5) In subsections (1) and (4), the amounts under subsections (1)(a)(ii) and (4)(a)(ii) shall be substituted with “$400,000” if the person does not carry on any trade or business during the basis period for the year of assessment 2012, and the balances under subsections (1)(b)(ii) and (4)(b)(ii) shall be substituted with “$400,000” if the person does not carry on any trade or business during the basis period for the year of assessment 2011.(6) In subsections (2) and (4) —

if the person does not carry on any trade or business during the basis period for any one year of assessment between the year of assessment 2013 and the year of assessment 2015 (both years inclusive), the references to “$1,200,000” in the paragraphs of those subsections applicable to the other 2 years of assessment shall be substituted with “$800,000”;

if the person does not carry on any trade or business during the basis periods for any 2 years of assessment between the year of assessment 2013 and the year of assessment 2015 (both years inclusive), the reference to “$1,200,000” in the paragraphs of those subsections applicable to the remaining year of assessment shall be substituted with “$400,000”; and

for the avoidance of doubt —

if the person does not carry on any trade or business during the basis period for the year of assessment 2013, no deduction shall be made from the substituted amount in subsection (2)(b)(ii) or (c)(ii) of the lower of the amounts specified in subsection (2)(a)(i) and (ii), or from the substituted amount in subsection (4)(d)(ii) or (e)(ii) of the lower of the amounts specified in subsection (4)(c)(i) and (ii); and

if the person does not carry on any trade or business during the basis period for the year of assessment 2014, no deduction shall be made from the substituted amount in subsection (2)(c)(ii) of the lower of the amounts specified in subsection (2)(b)(i) and (ii), or from the substituted amount in subsection (4)(e)(ii) of the lower of the amounts specified in subsection (4)(d)(i) and (ii).(6A) For the purposes of subsections (1), (2) and (4), where an individual carrying on a trade or business through 2 or more firms (excluding partnerships) has, during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive), incurred expenditure on the leasing of one or more PIC automation equipment under a qualifying lease or leases and (if applicable) the provision of one or more PIC automation equipment, in respect of such firms for the purposes of his trade or business, the deductions and allowances that may be allowed to him for that expenditure in respect of all his trades and businesses shall not exceed the amount computed in accordance with subsection (1), (2) or (4) (as the case may be) for that year of assessment.(6B) For the purposes of subsections (1), (2) and (4), where a partnership carrying on a trade or business has, during the basis period for any year of assessment between the year of assessment 2011 and the year of assessment 2015 (both years inclusive), incurred expenditure on the leasing of one or more PIC automation equipment under a qualifying lease or leases and (if applicable) the provision of one or more PIC automation equipment, for the purposes of its trade or business, the aggregate of the deductions and allowances that may be allowed to all the partners of the partnership for that expenditure in respect of all the trades and businesses of the partnership shall not exceed the amount computed in accordance with subsection (1), (2) or (4) (as the case may be) for that year of assessment.(6C) This section applies to expenditure incurred on procuring cloud computing services as it applies to expenditure incurred on the leasing of PIC automation equipment under a qualifying lease and, accordingly, a reference in this section (other than subsection (3)(b)) to the leasing of any PIC automation equipment under a qualifying lease includes a reference to procuring cloud computing services.”;

by inserting, immediately before the definition of “finance lease” in subsection (7), the following definitions:“ “cloud computing” means a model for delivering information technology services under which shared resources or software, or both, are provided to computers and other devices over a network such as the Internet;“cloud computing service” means any information technology service delivered by means of cloud computing;”;

by deleting the definition of “prescribed automation equipment” in subsection (7) and substituting the following definition:“ “PIC automation equipment” has the same meaning as in section 19A;”;

by deleting the words “prescribed automation equipment” in paragraph (b) of the definition of “qualifying lease” in subsection (7) and substituting the words “PIC automation equipment”;

by deleting the words “prescribed automation equipment” wherever they appear in subsection (8) and substituting in each case the words “PIC automation equipment”; and

by deleting the words “prescribed automation equipment” in the section heading and substituting the words “PIC automation equipment”.