TAX1501
EXAM PACK
,TAX1501 - TAXATION OF SALARIED PERSONS
MAY/JUNE 2026
EXAM ANSWERS
QUESTION ONE [25 MARKS]
Calculation of Nomsa Kumbi's tax liability for the year ended 28 February 2026
Nomsa is 38 years old and therefore qualifies only for the primary rebate. His South
African dividend is exempt from normal tax, while the foreign interest is included in
taxable income.
The remuneration is specifically stated in the question to be correctly calculated at R944
600.
1. Gross income
Item Amount (R) Tax treatment
Remuneration 944 600 Taxable
South African dividend 33 000 Exempt
Foreign interest 42 000 Taxable
Gross income 986 600
The South African dividend of R33 000 is excluded because qualifying South African
dividends are exempt from normal income tax.
Therefore:
Gross income = R944 600 + R42 000 = R986 600
,2. Deductions
Retirement annuity contribution
Nomsa contributed R60 000 to a retirement annuity fund.
The section 11F deduction is limited to the applicable percentage of
remuneration/taxable income, subject to the annual limit. The R60 000 contribution is
therefore fully deductible because it is below the applicable limit.
Retirement annuity deduction = R60 000
3. Taxable income before donation
Calculation R
Gross income 986 600
Less: Retirement annuity contribution (60 000)
Taxable income before donation deduction 926 600
4. Donation deduction
The donation to Help Organisation qualifies under section 18A because Nomsa
received a section 18A receipt.
The deduction is limited to 10% of taxable income before the donation deduction:
10% × R926 600
= R92 660
Although Nomsa donated R110 000, only R92 660 is deductible in the current year.
The balance is:
, R110 000 − R92 660 = R17 340
This excess is not deductible in the current year and may be carried forward subject to
the applicable rules.
Therefore:
Calculation R
Taxable income before donation 926 600
Less: Section 18A donation deduction (92 660)
Taxable income before medical tax credit 833 940
5. Normal tax
Nomsa's taxable income of R833 940 falls within the R673 001–R857 900 bracket.
The applicable formula is:
R179 147 + 39% of taxable income above R673 000
Amount above R673 000:
R833 940 − R673 000
= R160 940
39% × R160 940
= R62 766.60
Therefore:
R179 147 + R62 766.60
= R241 913.60
EXAM PACK
,TAX1501 - TAXATION OF SALARIED PERSONS
MAY/JUNE 2026
EXAM ANSWERS
QUESTION ONE [25 MARKS]
Calculation of Nomsa Kumbi's tax liability for the year ended 28 February 2026
Nomsa is 38 years old and therefore qualifies only for the primary rebate. His South
African dividend is exempt from normal tax, while the foreign interest is included in
taxable income.
The remuneration is specifically stated in the question to be correctly calculated at R944
600.
1. Gross income
Item Amount (R) Tax treatment
Remuneration 944 600 Taxable
South African dividend 33 000 Exempt
Foreign interest 42 000 Taxable
Gross income 986 600
The South African dividend of R33 000 is excluded because qualifying South African
dividends are exempt from normal income tax.
Therefore:
Gross income = R944 600 + R42 000 = R986 600
,2. Deductions
Retirement annuity contribution
Nomsa contributed R60 000 to a retirement annuity fund.
The section 11F deduction is limited to the applicable percentage of
remuneration/taxable income, subject to the annual limit. The R60 000 contribution is
therefore fully deductible because it is below the applicable limit.
Retirement annuity deduction = R60 000
3. Taxable income before donation
Calculation R
Gross income 986 600
Less: Retirement annuity contribution (60 000)
Taxable income before donation deduction 926 600
4. Donation deduction
The donation to Help Organisation qualifies under section 18A because Nomsa
received a section 18A receipt.
The deduction is limited to 10% of taxable income before the donation deduction:
10% × R926 600
= R92 660
Although Nomsa donated R110 000, only R92 660 is deductible in the current year.
The balance is:
, R110 000 − R92 660 = R17 340
This excess is not deductible in the current year and may be carried forward subject to
the applicable rules.
Therefore:
Calculation R
Taxable income before donation 926 600
Less: Section 18A donation deduction (92 660)
Taxable income before medical tax credit 833 940
5. Normal tax
Nomsa's taxable income of R833 940 falls within the R673 001–R857 900 bracket.
The applicable formula is:
R179 147 + 39% of taxable income above R673 000
Amount above R673 000:
R833 940 − R673 000
= R160 940
39% × R160 940
= R62 766.60
Therefore:
R179 147 + R62 766.60
= R241 913.60
