CLASS TEST 1
1.a) Chargeable income of Makume for the year ended 31 March 2016
Business Income Property Income
M M
Construction 350000
Rentals 120000
Gross income 350000 120000
Less: expenses
wages and salaries 196000
Superannuation fund 140000
repairs and maintenance 20200 8200
insurance 12500
hire purchase instalments(2250*5) 11250
depreciation:equipment 28880
depreciation:vehicles 67500
chargeable income -126330 111800
Tax payable by Makume
M
64200*20% 12840
47600*30% 14280
Tax liability 27120
less:personal tax credit 10080
withholding tax 17500
-460 There is no tax payable by Makume.
b)The loss is carried forward to the following year and will be off-set.
c)15 April 2016.
2.a)Nava is a resident of another country who works in Lesotho, therefore shes a resident non resident and will be taxed on he
b) Nava's chargeable income for the year ended 31 March 2016
Employment income
M
basic salary(5/12*150000) 62500
housing allowance(15000*5/12) 6250
education allowance 7000
gift 2300
chargeable income 78050
Terminal benefits
M
25% of annual gross salary(150000*25%) 37500
Terminal benefits:
severance pay: 15000
graduity 62000
77000
exempt portion -37500
chargeable terminal benefits 39500
c.i) A gift from an employer to an employee is a taxable employment income of the employee.
ii) Terminal benefit should exceed 25% of basic annual salary during the period of employment from income tax.
3.a) i. Interest deductions
Loan Amortisation Schedule
year opening balance repayments subtotal interest
M M M M 21%
1 175000 -69749 105251 22103
2 127354 -69749 57605 12097
3 69702 -69749 -47 0
Repayments=capital value/annuity factor
175000/2,509
M69749
Annuity factor=0,826+0,683+1
2.509
Allowable interest M
period 1 22103
period 2 12097
period 3 0
Total allowable interest 34200
ii) Depreciation allowance
M
1999/04/1 cost 175000
2001/03/31 depreciation 35000
2001/03/31 adjusted cost base 140000
2002/03/31 depreciation 28000
2002/03/31 adjusted cost base 112000
2003/03/31 depreciation 22400
2003/03/31 adjusted cost base 89600
Depreciation allowances M
period1 35000
period 2 28000
period 3 22400
Total deepreciation allowance 85400
b)Conditions that satisfy a 'resident company'
i.It should be formed under Lesotho laws.
ii,It should be managed in Lesotho
iii,Its operations should take place in Lesotho.
iv,It should have its controls in Lesotho.
4,i. The tax agent who fails to remit the tax withheld to the Commissioner within the time prescribed in the regulations will be
ii.Penalties applicable to a withholding tax agent who fails to withhold tax:
1,imprisonment of not more than 2 years
2.Pay a fine not exceeding M10000
3. or both.
dent and will be taxed on her Lesotho source income only.
m income tax.
closing balance
M
127354
69702
0
ed in the regulations will be personally held liable for the amount of tax that should have been withheld, but he can still recover that amou
n still recover that amount from the employee.
