Answer Happy

KEY INFORMATION TO TAKE NOTE OF IN REGARDS TO TAX IN
SOUTH AFRICA WITH THE ABOVE ADDITIONAL INFORMATION from South
African Revenue Services
- Age of Nelson 74 years old
- Nelson is a permanent resident
- Nelson and Dinky is married in community of
Property
***** When married in community of property in
South-Africa- tax calculation - the following 3 things to be shared
equally:
1.Investment income - Interest / Dividends
2.Rental income
3.Any Capital Gain received
**** Remember Investment income from Nelson and
Dinky to be added and divided by 2 and apply that
amount to Nelson****
- List all income individually -
- Tax rebate for Nelson to be calculated -1. First
primary rebate to be calculated- and then-2. Secondary rebate to be
calculated or taken of First primary
rebate
Calculations to be done on the following assumptions
- Nelson is employed for the full year of assessment
- Garden Cottage rented out for the full year of
assessment
- Dividends is for the full year of assessment
-Foreign interest is for the full year of assessment
**** Expenses for maintenance to rental property to be split 50
/ 50 as it is linked to the Rental income of the garden
cottage****
Requirement to be done
YOU ARE REQUIRED TO: Calculate the net tax liability for
Nelson Nilam for the year of assessment ending 28 February 2022.
(30 MARKS)
****Please do the required with all in mind as per
above information****
Nelson Nilam is a 74 year old resident of the Republic who works in the motor industry. He has been married in community of property to Dinky Magubane (aged 60) for 15 years. Nelson 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 pa Foreign - Dividends (From a listed company) R3 000 pa Foreign - Interest R 5000 pa 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. Dinky Magubane Income and expenses for the 2022 year of assessment: Salary R 18 000 pm Income from Tax Free Investments R 4 600pa
YOU ARE REQUIRED TO: Calculate the net tax liability for Nelson Nilam for the year of assessment ending 28 February 2022 Note: Please ensure that all tables and rebates used for the calculation are for the 2022 year of assessment. 2022 tax year (1 March 2021 - 28 February 2022) Taxable income (R) Rates of tax (R) 1 - 216 200 18% of taxable income 216 201 - 337 800 38 916 + 26% of taxable income above 216 200 337 801 - 467 500 70 532 + 31% of taxable income above 337 800 + 467 501 - 613 600 110 739 + 36% of taxable income above 467 500 613 601 - 782 200 163 335 + 39% of taxable income above 613 600 782 201 - 1 656 600 229 089 +41% of taxable income above 782 200 1 656 601 and above 587 593 + 45% of taxable income above 1 656 600
ADDITIONAL INFORMATION FOR SOUTH AFRICAN TAX CALCULATIONS Tax Thresholds Age Below age 65 Age 65 to below 75 Age 75 and older Threshold R87 300 R135 150 R151 100 Trusts, other than special trusts, will be taxed at a flat rate of 45%. Tax Rebates (natural persons) • Primary rebate - R15 714 • Secondary rebate (age 65 to below 75) - R8 613 · Tertiary rebate (age 75 and older) - R2 871 Exemptions Interest and dividend income • Under 65 years of age - The first R23 800 of interest income is exempt. • 65 years of age and over- The first R34 500 of interest income is exempt