- On 1 April 2002 John and his wife (married out of community of property) moved from Bloemfontein to Johannesburg when Johan was offered a position at the Checkers office in the Johannesburg CBD. They have 2 boys, aged 14 and 16.
- John receives a cash salary of R85 000 per month. Checkers contributes 8% and the employees 6% of the cash salary to a provident fund.
- On 1 January 2020 it was Johan’s 25th anniversary at Checkers. He was presented with R25 000 in cash to mark this milestone. At his 10th anniversary he received R10 000 and R20 000 on his 20th anniversary.
- John received a travel allowance of R15 000 a month from his employer. He often has to visit Checkers stores in other cities to assist with their financial matters. He kept a log book of his travels, which showed the following for the period 1 March 2019 to 29 February 2020:
|Travel between house and office||4 320 km|
|Travel to Checkers stores||10 810 km|
|Travel for private use||2 210 km|
|17 340 km|
- When John travels to the Checkers stores, he tries to return back home before bed time so he can spend some time with his sons. However, on a few occasions he had to sleep over in other cities and towns (all in South Africa). Checkers always arrange and pay for his accommodation, and pays him R380 per day for his meals and incidental costs. Johan spend 6 continuous days during the year away from his home, and did not keep accurate records of his expenses.
- As part of John’s transfer from Johannesburg to Cape Town, Checkers has paid the following amounts:
|Moving of furniture from Johannesburg to storage facility in Cape Town||R34 000|
|Storage of furniture 15 February 2020 – 28 February 2020||R3 350|
|New school uniforms for the two boys||R5 800|
|Architect’s fee to design a new house in Cape Town||R75 000|
- John contributed R2 000 per month to a Sanlam Retirement Annuity Fund.
- All the employees at Checkers’ head office can have lunch at no cost in the canteen. John had lunches to the value of R4 400 for the 2020 year of assessment. During the year-end audit the company ordered take away dinners for the financial personnel and the audit team on the evenings they worked late. The cost to the employer for John amounted to R850.
- John donated R10 000 to a local orphanage, for which he received a Section 18A certificate.
- Checkers held back R300 000 in terms of employees’ tax for the tax year.
- John paid provisional tax payments in total of R15 000 for the tax year.
- Calculate John Marubi’s income tax payable for the 2020 year of assessment. Show all your workings. (30)
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