Question $320$ Marks

Part A $10$ Marks

Mr$.$ Nelago signed a lease agreement on $1$ April $2021$ for a period of $10$ years for the

rent of an old house adjacent to his current business property. He had to pay rent of

N$$20000$ per month, a lease premium of N$$120000$ and to make improvements to the

building of N$$600000.$ Mr$.$ Nelago also developed a parking lot on the premises for

which he charged parking fees for customers at a cost of N$$40000.$ The improvements

were completed on $31$ December $2021$ from which date he started to do business in the

new building. Assume that the lease rentals are only payable from the date the lease

improvements are completed.

YOU ARE REQUIRED TO determine the amounts deductible in respect of this

transaction for the $2022$ year of assessment.

COMPLETE THE FOLLOWING:

ITEM DEDUCTION

Rent?

Lease Premium allowance $?$

Lease improvement allowance?

Parking lot expenses?