Amos Mamboleo has not been filing his annual income tax returns since he was employed. The revenue authority has issued him with an assessment for...

      

Amos Mamboleo has not been filing his annual income tax returns since he was employed. The revenue authority has issued him with an assessment for the year 2010 of Sh.1,200,000 which he refutes. He has approached you for advice and has provided the following details:

1. Basic salary Sh.120,000 (pay as you earn tax Sh. 17,500) per month.
2. The employer contributed for him Sh.8,000 per month to his children‘s education insurance policy.
3. He had salary arrears for the year 2009 of Sh400,000 which he was paid on 1 July 2010. His gross salary during the year 2009 was Sh960,000 (pay as you earn tax Sh184,000)
4. He secured a bank loan on 1 October 2010, of sh.4,800,000 at 15% interest per month which he used to purchase a house. He leased the house to the employer at a monthly rental income of Sh 80,000 which effect from 1 November 2010.
5. He is housed by the employer in a leased house where the company pays rent on quarterly basis of Sh300,000 per quarter.
6. He controls 18% of the share capital issued by the employer. During the year ended 31 December 2010, he received dividends on the shares of Sh.95,000 net of withholding tax.
7. He uses a company car of the employer has leased at a monthly charge of Sh40,000.
8. His other income comprised:
leo11322019440.png

Prepare:
(i) Taxable income and the tax thereon for Amos Mamboleo for the year ended 31 December 2010.
(ii) Advise Amos Mamboleo on whether he should object to the assessment issued by the revenue authority.

  

Answers


Wilfred
leo21322019442.png
Wilfykil answered the question on February 13, 2019 at 12:43


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