Requirements for this paper:
Multiple- Non-programmable Open book
choice answer N calculator: Y examination? N
sheets:
Graph paper: Laptop:
N N
EXAMINATION: Assignment PROGRAMME: BCom Accounting
MODULE CODE: MTAX62112 DURATION: Due date
MODULE Taxation 2A MARKS: 60
DESCRIPTION:
EXAMINER(S): ED Abrahams DATE: 10/4/2025
MODERATOR(S): K Kaelo TIME:
Instructions:
1. Show all calculations.
2. Do tax calculations in line with the tax framework
3. Write neatly and provide answers in a structured manner.
4. Work in groups of 3 – 5. One member in the group submits on Moodle.
5. SUBMIT IN PDF FORMAT.
6. DUE DATE 17 APRIL 2025 16:00 p.m.
MTAX62112 Assignment 2025 Page 1 of 5
Question 1 (16 marks)
Mr. Delicious owns all the issued shares of ZTAX (Pty) Ltd. The business renders
accounting services and sells computer programs. Mr. D has “permitted”
shareholdings in seven other entities.
The gross income of ZTAX (Pty) Ltd for the February 2025 year of assessment is as
follows:
Sale of computer programmes R2 440 000
Services rendered by Mr. Delicious to the company’s clients R240 000
Services rendered by Mrs. Delicious to the company’s clients R200 000
Dividends R100 000
Interest income R200 000
In addition to the above, the company made a capital gain of R900 000 on the sale of
a building in which it ran its business. The building was sold for R2 million. The
company’s tax-deductible expenses (including salaries to Mr. and Mrs. Delicious) for
the year of assessment amounted to R2 430 000.
Required:
a) Determine, in detail, whether ZTAX (Pty) Ltd is a Small Business Corporation
(10 marks).
b) Calculate the tax payable by ZTAX (Pty) Ltd. (ZTAX (Pty) Ltd is not a ‘personal
service provider’) (6 marks).
Question 2 (5 marks)
Mr X resigned from his job and started a micro business on the 15 April 2024. His
turnover for the period from 15 April 2024 to 28 February 2025 was R900 000. He
therefore qualifies to register as a micro business, because his turnover falls within the
proportional turnover limit of R916 667 for micro businesses. (R1 000 000*11/12 =
R916 667).
MTAX62112 Assignment 2025 Page 2 of 5
He converted his garage into business premises at a cost of R100 000. The garage
made up 10% of the total property (not mainly used for business purposes), which cost
R1 200 000 in 2014. The property was his primary residence.
He sold the property on 5 January 2025 for R2.3million. He calculated that the portion
of the sales proceeds that relate to the garage amount to R320 000. Mr X also sold a
delivery vehicle that he used to deliver goods. The vehicle cost R600 000 in 2017, and
he sold it on 15 January 2025 for R300 000.
Required:
Calculate the taxable turnover and tax payable of Mr X (5 marks)
Question 3 (14 marks)
The following company has a year of assessment that ends on 28 February 2030 and
the company is not a small business corporation as defined in the Income Tax Act.
The following information is presented to you:
Year of assessment Date of ITA34 income Taxable income
tax notice of
assessment
2027 4 June 2027 R 990 750
2028 1 August 2029 R1 950 500
2029 12 September 2029 R2 850 750
2030 Estimated – not yet R3 200 350
assessed
Assume the corporate tax rate remained at 28%. Round off all amounts to the
nearest Rand.
Required:
a) Calculate the first provisional tax payment of the above company for the 2030
year of assessment. (7 marks)
b) Calculate the second provisional tax payment of the above company for the 2030
year of assessment. (4 marks)
c) Your friend, Tally says that provisional tax is a separate tax and companies receive
a separate income tax number for provisional tax. Do you agree with Tally?
MTAX62112 Assignment 2025 Page 3 of 5
Explain why you agree or disagree by explaining what provisional tax is and why
it is paid. (3 marks)
Question 4 (22 marks)
Stormy (Pty) Ltd (Stormy) provides consulting services for various businesses. The
following transactions took place during the 2025 year of assessment. Stormy Ltd has
a 28 February year-end.
1. Consultation to XYZ (Pty) Ltd R250 000
2. Proceeds from Key-man insurance policy payout R300 000
(Stormy owned a life insurance policy on one of its primary consultants. Stormy
deducted the insurance premiums from their income in the current year of
assessment)
3. Stormy manufactured a digital printing device that assists them in the business. This
asset was sold for R25 000.
4. Stormy provided consultation services to Ben Book on 1 February 2025 for an
invoiced amount of R75 000. Stormy received payment on 28 March 2025.
5. On 1 August 2024, Stormy entered into a lease contract with Amanda. From 1
August 2024, a monthly rental amount of R25 000 is payable to Stormy for the lease
of building A. A lease premium of R220 000 was paid to Stormy on 15 August 2024.
6. Stormy purchased Building 1 and 2 when he won the lotto in 2010. Building 1
earned rental income of R35 000 per month for Stormy. On 1 December 2024,
Stormy sold Building 1 for R3 000 000, because he could not manage the leasing
administration any longer and needed the cashflow.
Required:
Calculate the total gross income amount of Stormy (Pty) Ltd for the year of assessment
ending 28 February 2025. Give detailed reasons why an amount is included or
excluded from gross income (use case law where necessary) (22 marks).
Structure your solution as follows:
Description Amount included/excluded Detailed reason
MTAX62112 Assignment 2025 Page 4 of 5
Question 5 (3 marks)
Required:
For each of the accruals or receipts listed below, state whether it will constitute gross income
or not and give a reason for your answer.
1. Baby Face received R750 000 in a defamation of character lawsuit against Crow Face
and she was successful (2 marks).
2. JCole received R25 000 as reimbursement from a supplier for materials he purchased
that were not suitable for human consumption (1 mark).
MTAX62112 Assignment 2025 Page 5 of 5
