Organic Produce Pte Ltd (“Organic Produce”), a distributor of organic produce sourced from Europe and the region, was incorporated in Singapore on 15 August 2018. The produce is sold through distributors in the region, restaurants, and supermarkets in Singapore as well as through the company’s shop outlet in Serangoon Gardens Singapore. It is equally owned by 3 friends together with Organic Produce Inc, a company tax resident in Country X. Its first financial year ended on 31 July 2019.

The company’s executive directors conduct all their meetings in Singapore. The company’s accounts for the year ended 31 July 2021 reported total revenue of $4,520,000 and a net profit before taxation of $428,400 after taking into account the following income and expenses:

Required

For Y/A 2022, compute the minimum net tax payable of Organic Produce Pte Ltd.
 

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Income 1. Dividend income The dividend income is received from share investment in Country A, a tax haven country. The income was used to settle business travel expenses incurred by the marketing manager when he was in Country A from 28 to 30 June 2021 to visit customers and suppliers. 2. Interest accrued on loan The interest is in respect of a loan given to the finance manager. Interest is due every month end. The company agreed to let the finance manager settle the total interest due for the year on 15 August 2021. 3. Foreign exchange gains Settlement of debts owing to suppliers. Revaluation gain on trade receivable balances at year end. Revaluation gain on loan from Organic Produce Inc. 4. Rental income Rental derived from sub-let of excess space in shop outlet. Expenses 5. Depreciation The above relates to depreciation charged on the company's fixed assets for the year. 6. Loss on disposal of fixed assets The company disposed of a laptop during the year. The laptop was bought on 30 April 2019 for $2,400. On 3 June 2021, it was sold for $500. $ 12,500 4,000 12,000 8,900 3,600 24,500 18,000 344,000 800 Income 1. Dividend income The dividend income is received from share investment in Country A, a tax haven country. The income was used to settle business travel expenses incurred by the marketing manager when he was in Country A from 28 to 30 June 2021 to visit customers and suppliers. 2. Interest accrued on loan The interest is in respect of a loan given to the finance manager. Interest is due every month end. The company agreed to let the finance manager settle the total interest due for the year on 15 August 2021. 3. Foreign exchange gains Settlement of debts owing to suppliers. Revaluation gain on trade receivable balances at year end. Revaluation gain on loan from Organic Produce Inc. 4. Rental income Rental derived from sub-let of excess space in shop outlet. Expenses 5. Depreciation The above relates to depreciation charged on the company's fixed assets for the year. 6. Loss on disposal of fixed assets The company disposed of a laptop during the year. The laptop was bought on 30 April 2019 for $2,400. On 3 June 2021, it was sold for $500. $ 12,500 4,000 12,000 8,900 3,600 24,500 18,000 344,000 800

Answer rating: 100% (QA)

The minimum net tax payable of Organic Produce Pte Ltd for YA ... View the full answer