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Income Tax
Essay specific features
Written by:
Robert B
Date added:
December 27, 2015
Level:
University
Grade:
A
No of pages / words:
4 / 953
Was viewed:
7244 times
Rating of current essay:
Essay content:
They are:
1. Start of with the net profit/loss for the profit and loss account.
2. Add back any expenses, which are not allowable.
3. Subtract any incomes that are not taxable under case I and II. E.g. rental income.
Treatment of Expenses
Expense: Add back Do Not Add back
? Any expense that is wholly and exclusively for the business P
? Expenses not for the business P
? Owners drawing/salary ? anything owner takes for private use P
? Political/charitable donations P
? Any expense incurred for the employees P
? Capital expenditure ? costs associated with buying/improving fixed assets P
? Depreciation P
? Repairs to fixed assets P
? Bad debts P
? Increase in general provision P
? Increase in specific provision P
? Repaying capital sum of loans P
? Business entertainment P
? Penalties/fines for breaking the law P
? Car lease costs P (Some)
Notes:
1...
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Car Lease Costs:
Write down the total lease costs.
Step 1 - subtract personal percentage of the Owner's car only.
Step 2 - subtract:
Answer after step 1 x (Price of car - ?22,000)
Price of the Car
NB: The amounts that you subtract are the amounts that are to be added back.
2. General Provision:
Created a 2% provision ? add back as it is only a general provision and is not tax deductible...
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