Question $3$

$(38$ marks$)$

Bala Lamuna is $66$ years old and is currently struggling to book an appointment with SARS, he approached you just after receiving his statement of account from SARS showing that he must pay an amount of R$17561$ for the current year of assessment. Below is the list of all gross income received by Bala:

Bala received a local interest of R$53850$ for the current year of assessment

Bala received R$23900$ local dividends and R$88000$ foreign dividends

Bala received a monthly UIF of R$12800$

Bala met with potential client on a weekly basis and therefore always had to be dressed professionally. For this reason, Bala bought a plain, black suit from MarkMan Suites store every year in January at R$4800.$ Bala refer to his suit as his "uniform".

In order for Bala to strengthen his skills, he enrolled for a certificate in computer sciences. Johannesburg University awarded him with a full bursary worth R$55000.$

Bala purchased an annuity on $1$ February $2020$ for R$280000.$ It pays an annuity of R$3500$ per month for $15-$year period.

Required

a$)$ Bala Lamuna is of the opinion that all the above transactions should exempt for tax purposes. He approached you to assist in calculating total gross income, total exempt income and taxable income for the current year of assessment. NB: SHOW ALL YOUR CALCULATIONS TO GET FULL MARKS. Please refer to the relevant sections of the Act and provide reasons for items with no tax impact. Indicate with a R Nil $($RO$)$ where no amount is deducted. $(35$ marks

$7$

Interest Exemptions

Interest from a South African source earned by a natural person is exempt, per annum, up to an amount of:

$\backslash$table$[[,2025],[$Person younger than $65,$R$23800],[$Person $65$ and older,R$34500]]$

Recommended answer format:

$\backslash$table$[[$Description$,$Relevant section of the Act and Calculations,$R$