Question: Can someone do this question please Question 4 You are a tax adviser to Canal Ltd and Scarlett. Your manager Leo has asked you to

 Can someone do this question please Question 4 You are a

Can someone do this question please

Question 4 You are a tax adviser to Canal Ltd and Scarlett. Your manager Leo has asked you to prepare brief notes to address two client issues whilst he is on holiday today. He is meeting with both clients tomorrow. a) Canal Ltd started trading on 1 July 2017 manufacturing and selling designer light fittings. All of the supplies are classified as standard rated for VAT purposes. Canal Ltd's turnover for the 10 months to 30 April 2018 is 71,000 and due to a large contract with a high street retailer the turnover for May and June 2018 is expected to be 12,000 and 21,000 respectively. The managing director of Canal Ltd, Julia, has asked for advice as to whether the company should register for VAT and when the registration should take place. She would prefer not to charge VAT to Canal Ltd's smaller private customers. If Canal Ltd were to become VAT registered, Julia would also like advice as to whether it can reclaim input tax on the materials purchased in the manufacturing process and the cost of a new car purchased by Canal Ltd and provided to her for private and business purposes. b) Scarlett submitted her 2016/17 income tax return at 1.30 am on 1 February 2018. However, she forgot to include 200 of UK bank interest which she received during the year. She is unsure what penalties she may incur for this mistake. Required Prepare the notes requested by Leo. (Total - 20 marks) Part a) 11 marks Part b) 9 marks

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