Question: Let's break down each transaction's impact on Preeya Naidoo's normal tax calculation: 1 . * Loan from First National Bank ( R 5 0 ,
Let's break down each transaction's impact on Preeya Naidoo's normal tax calculation:
Loan from First National Bank R for business equipment
The loan itself isn't taxable income.
Interest paid on the loan R is deductible as a business expense.
Loan from Capitec R for rental deposit on a townhouse
The loan itself isn't taxable income.
Interest paid on the loan R is not deductible as it's for a personal expense rental deposit
Dividends earned from a South African source R
Dividends from South African companies are exempt from tax in the hands of the shareholder Preeya Naidoo as they're subject to Dividends Tax.
Total revenue generated from the catering business R
This revenue is taxable and will be included in Preeya's taxable income.
SARS fine for late submission of provisional tax returns R
The fine is not deductible for tax purposes, as it's a penalty.
In summary:
Business loan interest R is deductible.
Personal loan interest R is not deductible.
Dividends R are exempt from tax.
Business revenue R is taxable.
SARS fine R is not deductible.
These transactions will impact Preeya's taxable income and normal tax calculation accordingly.
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