Mr Tevita is originally from Labasa and moved to Suva in 2009. He had a parental...
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Mr Tevita is originally from Labasa and moved to Suva in 2009. He had a parental property there which he sold and bought a house (House A) in suburb in Suva back 2010. He stays there with his wife and two young kids. He had also bought another house (House B) in January 2013. The acquisition cost of new was $260 000. He spent $15000 to upgrade the house. This new house has two flats. This new property (House B) is a concrete house. In December 2018, Mr Tevita decided to sell his House B due to some financial difficulties. He was asking for $700 000 but finally, deal settled to $650 000. He had to pay commission to real-estate agent $20000. He also had to pay legal fee $3500 and stamp duty $2500. In Fiji, Capital Gain Tax is 10%. Depreciation for a concrete house is 2.5%. Required: Calculate Mr Tevita's Net Capital Gain and calculate his Capital Gain Tax payable on the sale of the house. (5 marks) Mr Zhu is Director - Marking and Customer Relations in a five-star resort based in Mana Island. The resort is very popular among Asian nationals. Mr Zhu is originally from Singapore, have worked in Auckland and now working with the resort for the last two years. He is entitled to cash and non-cash benefits. Details of the benefits are as follows: Cash Benefit: • Salary -$148 000 • Motor vehicle allowance - $9.000 Mr Zhu has one kid who is studying in a popular school in Nadi. The resort pays for school fee which is $4 500 per annum. Non cash benefits: • Household personal fringe benefits $15 000 annual • The Resort has provided a furnished house. Rent is $1 800 per month. • He is entitled to $ 100-week meal allowance. This meal is provided in the resorts' restaurant. • The resort has also provided him a car. The engine capacity of the car is 2000 CC. Tax details for car allowances are below: Engine Capacity Under 1,800cc 1,800cc and <2,000cc 2,000cc and above Value for each Quarter (VEP Amount) $656 $778 $958 He is also entitled to personal expenditure fringe benefits. He gets $500 per month for personal expenditure Required: Calculate the value of the net fringe benefit, gross fringe benefit and FBT payable Mr Chand, a very renowned retired professor from a local university and entrepreneur, has commercial and residential properties in Suva and Nadi area. Mr Chand is happily married with two kids. After receiving some advices from his friend and considering an emerging trend in neighbouring countries like Australia and New Zealand, he decided to make a trust. This trust will look after all the properties upon his death. As per his will, wife Maria will get 40% of the share while son Prasad and daughter Ayana will get equal share in the net profit. Mr Chand died in 2016. During the financial year 2018, the followings are financial transactions: • Commercial properties are rented out which generated $360 000 rent during the year • From the residential properties they earned $100 000 Mr Chand had some deposits in Westpac worth $200 000, and the return is 4.5% annual • Mr Chand had 50 000 shares in a Fiji based organisation. The organisation has declared $0.22 per share as dividend • For the commercial rented property, the costs incurred were: > Insurance $6 000 Depreciation $22 000 Local council rates $2 800 ➤ Leasing costs $9 000 Security of the premises $11 000 ➤ Fine by local council $5 500 Required: Calculated Income Tax for each beneficiary for the financial year 2018. (10 marks) Mr Tevita is originally from Labasa and moved to Suva in 2009. He had a parental property there which he sold and bought a house (House A) in suburb in Suva back 2010. He stays there with his wife and two young kids. He had also bought another house (House B) in January 2013. The acquisition cost of new was $260 000. He spent $15000 to upgrade the house. This new house has two flats. This new property (House B) is a concrete house. In December 2018, Mr Tevita decided to sell his House B due to some financial difficulties. He was asking for $700 000 but finally, deal settled to $650 000. He had to pay commission to real-estate agent $20000. He also had to pay legal fee $3500 and stamp duty $2500. In Fiji, Capital Gain Tax is 10%. Depreciation for a concrete house is 2.5%. Required: Calculate Mr Tevita's Net Capital Gain and calculate his Capital Gain Tax payable on the sale of the house. (5 marks) Mr Zhu is Director - Marking and Customer Relations in a five-star resort based in Mana Island. The resort is very popular among Asian nationals. Mr Zhu is originally from Singapore, have worked in Auckland and now working with the resort for the last two years. He is entitled to cash and non-cash benefits. Details of the benefits are as follows: Cash Benefit: • Salary -$148 000 • Motor vehicle allowance - $9.000 Mr Zhu has one kid who is studying in a popular school in Nadi. The resort pays for school fee which is $4 500 per annum. Non cash benefits: • Household personal fringe benefits $15 000 annual • The Resort has provided a furnished house. Rent is $1 800 per month. • He is entitled to $ 100-week meal allowance. This meal is provided in the resorts' restaurant. • The resort has also provided him a car. The engine capacity of the car is 2000 CC. Tax details for car allowances are below: Engine Capacity Under 1,800cc 1,800cc and <2,000cc 2,000cc and above Value for each Quarter (VEP Amount) $656 $778 $958 He is also entitled to personal expenditure fringe benefits. He gets $500 per month for personal expenditure Required: Calculate the value of the net fringe benefit, gross fringe benefit and FBT payable Mr Chand, a very renowned retired professor from a local university and entrepreneur, has commercial and residential properties in Suva and Nadi area. Mr Chand is happily married with two kids. After receiving some advices from his friend and considering an emerging trend in neighbouring countries like Australia and New Zealand, he decided to make a trust. This trust will look after all the properties upon his death. As per his will, wife Maria will get 40% of the share while son Prasad and daughter Ayana will get equal share in the net profit. Mr Chand died in 2016. During the financial year 2018, the followings are financial transactions: • Commercial properties are rented out which generated $360 000 rent during the year • From the residential properties they earned $100 000 Mr Chand had some deposits in Westpac worth $200 000, and the return is 4.5% annual • Mr Chand had 50 000 shares in a Fiji based organisation. The organisation has declared $0.22 per share as dividend • For the commercial rented property, the costs incurred were: > Insurance $6 000 Depreciation $22 000 Local council rates $2 800 ➤ Leasing costs $9 000 Security of the premises $11 000 ➤ Fine by local council $5 500 Required: Calculated Income Tax for each beneficiary for the financial year 2018. (10 marks)
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Question 1 5 marks Mr Tevitas Capital Gain on sale of House B Acquisition cost of House B in Jan 2013 260000 Upgrades spent on House B 15000 Total cos... View the full answer
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Business Law The Ethical Global and E-Commerce Environment
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15th edition
Authors: Jane Mallor, James Barnes, Thomas Bowers, Arlen Langvardt
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