Exam (elaborations)
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- Course
- TAX3701 (TAX3701)
- Institution
- University Of South Africa (Unisa)
TAX3701 Assignment 1
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TAX37011.Tshesane (Pty) Ltd is a registered Value-Added Tax (VAT) vendor that makes only taxable supplies.
Below is a summary of income received during the two-months period ended 31 December 2023:
Interest income R23 450
Revenue from sales of goods R123 000
Insurance receipt (in respect of damaged microwave used by staff) R8 500
All amounts include VAT unless otherwise stated.
Interest income – exempted Rnil
Revenue from sales (R123 000 x 15/115) R16 043
Insurance receipt (deemed supply) (R8 500 x 15/115) R1 109
Total output sales R17 052
Required:
Calculate the total output tax arising from the above transactions.
a.R16 043
b.R20 211
c.R19 102
d.R17 152
2. Sanders Ltd, is a registered Value-Added Tax (VAT) vendor that makes only taxable
supplies. Below is a summary of expenditure incurred during the two-months period ended
31 December 2023.
• Fuel for delivery vehicle R5 800
• Acquisition of a five-seater company car R389 000
• Trading stock purchases R240 000
All amounts include VAT unless otherwise stated.
Required:
Calculate the total input tax arising from the above transactions.
a.
R82 043
b.
R82 800
,c.
R31 304
d.R32 61
Fuel – zero rated Rnil
Five seater company car – input tax denied Rnil
Trading stock – (R240 000 x 15/115) R31 304
Total input tax claimable R31 304
Question 3
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Rainy Day Ltd is a South African resident company that distributes rain and storm protective
wear. The South African Revenue Service is satisfied that the company will make the
following supplies during the next twelve-months period:
• Standard rated supplies R21 000 000
• Zero-rated supplies R6 500 000
• Exempt supplies R10 000 000
Total value of supplies R37 500 000
Required:
Which Value-Added Tax period is the South African Revenue Service likely to categorise
Rainy Day Ltd under?
a.
Category A
b.
Category D
c.
Category E
,d.
Category C
Standard rated supplies R21 000 000
Zero rated supplies R6 000 000
Taxable supplies R27 000 000
The taxable supplies are below R30 000 000, the vendor should register as either
Category A or B
The answer therefore – is Option A
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Rambo and Sons Ltd is a South African resident company operating mainly in the
manufacturing industry. The company houses four divisions each producing distinct
products. The company has a centralised finance department that oversees the company’s
financial functions. The company’s director is concerned about the company’s eligibility to
register as a Value-Added Tax (VAT) vendor for the 2024 year of assessment. Below is a
breakdown of the supplies made by each division during the 2023 year of assessment.
Division A R240 000
Division B R375 000
Division C R600 000
Division D R155 000
Notes: Division A and C only make standard rated supplies. Division B makes 50% zero-
rated supplies and 50% exempt supplies. Division D only makes exempt supplies.
Required:
Which of the following statements is correct in respect of Rambo and Sons Ltd?
Division A & C (R240 000 + R600 000) R840 000
Division B (R375 000 x 50%) R187 500
Taxable supplies R1 027 500
a.
Rambo and Sons Ltd is mandatorily required to register for VAT as the total value of taxable
supplies exceeds R1 000 000.
b.
, Each of Rambo and Sons Ltd divisions qualifies to separately register for VAT as each
division manufactures distinct products.
c.
Rambo and Sons Ltd is not mandatorily required to register for VAT as the total value of
taxable supplies does not exceed R1 000 000.
d.
The value of Rambo and Sons Ltd’s non-taxable supplies amounts to R530 000.
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Various Ltd is a South African resident company that sells a variety of imported goods to
the larger South African public. During the 2024 year of assessment, Various Ltd purchased
10 000 stylish cooler boxes that can keep beverages cool for a longer period than an
average cooler box. These cooler boxes were imported from Namibia. The purchase price
per cooler box was R480 on the day the transaction was concluded. The total custom duty
value of the imported items was determined as R3 200 000. Various Ltd paid import duties
amounting to R97 450 and non-refundable import surcharges of R12 300 on the
transaction.
Required:
Calculate the input tax claimable by Various Ltd in respect of the above transaction.
Customs duty value R3 200 000
Import duties R 97 450
Non-refundable import surcharges R12 300
R3 309 750
Input tax claimable (R3 309 750 x 15%) R496 463
a.
R473 446
b.
R736 463
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