John Wilson 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:

2. Salaries and wages include an amount of $130,000 that is paid to Niko Monthly.
4. Miscellaneous expenses include $9,000 per week for a household helper. The helper works a quarter of her time to the store.
6. One third of the utilities relate to the owner's private use.
8. Capital allowances for the year assessment amounted to $320,000 and balancing charges of $40,000
10. Donations to an approved charitable intuition for $270,000 were not recorded in the accounts.
12. He paid estimated taxes during the year of $410,000.

Required:

2. Calculate John's Income tax liability for the year of assessment 2019, taking into account the fact that he is 66 years old.
4. Make relevant notes.

Answer rating: 100% (QA)

To calculate John Wilsons income tax liability for the year of assessment 2019 we ne... View the full answer