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Taxation 2A Final OSA

The document outlines a final online summative assessment for Bachelor of Commerce students in Accounting and Financial Management, focusing on Taxation 2A. It includes five questions requiring calculations of taxable capital gains, travel allowances, tax payable, tax residency implications, and tax on retirement lump sums. Each question specifies the financial details of individuals and the necessary calculations for the 2022 year of assessment.

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5 views9 pages

Taxation 2A Final OSA

The document outlines a final online summative assessment for Bachelor of Commerce students in Accounting and Financial Management, focusing on Taxation 2A. It includes five questions requiring calculations of taxable capital gains, travel allowances, tax payable, tax residency implications, and tax on retirement lump sums. Each question specifies the financial details of individuals and the necessary calculations for the 2022 year of assessment.

Uploaded by

krlmbudgetreporting
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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FINAL ONLINE SUMMATIVE ASSESSMENT

PROGRAMME Bachelor of Commerce in Accounting


Bachelor of Commerce in Financial Management

MODULE Taxation 2A

YEAR Two (2)

INTAKE January 2023 Semester 1

DATE 22 June 2023

TOTAL MARKS 100


QUESTION 1 (20 Marks)

Lilly Marshall is a resident of the republic of South Africa. She is the owner of various assets and property in the
country and has made the decision to sell a few of her assets. Lilly Marshall has been living in her home which
she bought 10 years ago), she has now decided to relocate to another province due to a change in her job. Her
residential property was bought at a cost price of R 2 700 000 in January 2011 and it was sold for R 4 500 000
in January 2022. She owned shares in Picachu (Pty) Ltd which she purchased for a cost of R 120 000, she
required extra cash to purchase furniture for her new home and decided to sell the shares for R 213 000 in
February 2022, she does not deal in the buying and selling of shares. Lilly has been having problems with the
payment of rental from her tenant in a flat that she rents out, she has therefore decided to sell this flat. The flat
was purchased for R 1 500 000 in June 2016 and sold for R 1 950 000 in October 2021 In addition to the assets
that were sold in the current year of assessment she had made a capital loss of R 245 000 from the 2021 year
of assessment.

YOU ARE REQUIRED TO: Calculate the taxable capital gain or loss for Lilly Marshall for the 2022 year of
assessment.
QUESTION 2 (20 Marks)

Toby Maguire received a travel allowance from his employer amounting to R 65 000 for the current year of
assessment. He uses his car for business and private travels. He bought this car exactly 1 year ago for R 230 000
(including a VAT). Toby travelled a total of 14 500 kilometres during the current year of assessment, of which
9 500 were for private purposes. He also kept an accurate record of expenses incurred in respect of the car for
the current year of assessment. The costs are as follows:
R

Finance charges 39 555

Maintenance cost 5 500

Fuel cost 11 500

Insurance premiums and licences fees 4 250

YOU ARE REQUIRED TO: Calculate the taxable portion of the travel allowance received by Toby Maguire for
the 2023 year of assessment.
QUESTION 3 (35 Marks)

Thabo is a 68-year-old resident of the Republic who works in the oil industry. He has been married in community
of property to Thandi (aged 63) for 15 years.

Thabo has the following income and expenses for the 2022 year of assessment:
Income

Salary R 25 000 pm

Bonus 10% of gross salary

Interest local R 80 000 pa

Dividends- (listed SA company) R 15 000

Foreign – Dividends (From a listed company) R 3 000 pa

Foreign – Interest R 5 000

Rental Income (derived from garden cottage) R 10 000 pm

Expenses

Maintenance to rental property R 30 000 pa

He belongs to a medical aid fund to which he contributed R3 000 per month to during the year of assessment
and he had medical expenses of R23 500, which were not covered by the medical aid fund. His employer also
deducts employees’ tax of R12 785 and he paid R20 200 provisional tax for the 2022 year of assessment.

Thandis Income and expenses for the 2022 year of assessment:


Salary R 18 000 pm
Income from Tax Free Investments R 4 600

YOU ARE REQUIRED TO: Calculate the tax payable for Thabo for the year of assessment ending 28 February
2022.
Note: Please ensure that all tables and rebates used to for the calculation are for the 2022 year of
assessment.
QUESTION 4 (20 Marks)

4.1 Paul Peter is an Italian citizen who is ordinarily a resident in Italy. He is not ordinarily resident in South Africa.
During a work trip in 2017 and 2018, he was in South Africa from 1 April 2017 until 15 February 2017. He enjoyed
his stay in South Africa and visited again from 1 June 2019 to 31 December 2019. During November 2020 and
December 2020, he again visited South Africa for eight weeks (56 days). During 2021, he visited South Africa
once more, from 1 October 2021 to 31 December 2021 for 92 days. (16 Marks)

4.2 Elizabeth uses street vendors to sell pirated versions of well-known CDs to the general public. Her income
from these activities amounted to R110 000 for the current year of assessment. You are required to determine
whether Elizabeth will be taxed on the income received. (4 Marks)

YOU ARE REQUIRED TO: Indicate if the above persons will be subject to normal tax in South Africa for the 2022
year of assessment.
QUESTION 5 (5 Marks)
Bongani Ndamase retired on 31 December 2021 at the age of 65. He received the following information regarding
the lump sum that his pension fund will pay him on date of retirement:

· A lump sum amount of R1 845 000 (before tax) will be payable to him.
· During the 30 years that he was a member of the fund, R45 000 of his own contributions were not allowed
as deductions in terms of section 11F of the Act.
· Bongani’s taxable income excluding the lump sum amount for the current year of assessment is R750 000.
He did not previously receive any lump sum payments.

YOU ARE REQUIRED: To calculate the tax that Bongani will pay on the lump sum received from the pension
fund of the 2022 year of assessment.
APPENDIX
Tax tables:

Rebates:
Medical tax credits:

Lump sum tax table (Withdrawal)


Lump sum tax table (Serverance)

Fixed cost table – 01 March 2022 – 28 February 2023

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