Reference no: EM133156328
Question - Type solution in the answer sheet provided. Niko Williams owns and operates a boutique in the Montego Bay area. His net profit for the year of assessment 2019 was $4,000, 000 after charging the following:
|
|
$
|
|
Electricity
|
151,800
|
|
Insurance
|
83,100
|
|
Depreciation
|
400,000
|
|
Miscellaneous expenses
|
500,000
|
|
Wages & salaries
|
7,500,000
|
|
Bad debts (specific)
|
130,000
|
|
Tax penalty
|
120,000
|
|
Utilities
|
105,000
|
|
Repairs and Maintenance
|
1,700,000
|
|
Consultancy
|
100,000
|
|
General provision for bad debts
|
140,000
|
Additional Information:
1. Salaries and wages include an amount of $130,000 that is paid to Niko Monthly.
2. Miscellaneous expenses include $9,000 per week for a household helper. The helper works a quarter of her time to the store.
3. One third of the utilities relate to the owner's private use.
4. Capital allowances for the year assessment amounted to $320,000 and balancing charges of $40,000
5. Donations to an approved charitable intuition for $270,000 were not recorded in the accounts.
6. He paid estimated taxes during the year of $410,000.
Required -
1. Calculate John's Income tax liability for the year of assessment 2019, taking into account the fact that he is 66 years old.
2. Make relevant notes.