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Tax3761 Exam Summary notes
Explains each chapter in a simple understandable form.
, 1
TXN203D - summary
Framework for calculation of taxable income :
R
Gross income xxx (gross income general definition & specific
inclusions)
less : exempt income (xx)
Income xxx
less allowable deductions (xx) (general deduction formula, specific deductions
& capital allowances)
Taxable income xxx (from revenue activities)
add Taxable Capital Gain xxx
Taxable income xxx
If given amount including vat 100/114
If want to calc vat owing on amount 14/114
Output vat = vat levied on sold goods
Input vat = vat that can be claimed back from purchase of goods.
Taxable supply
Standard rate supply Zero rated supply Exempt supply
14% 0% no vat
Supplies that are not Supplies listed in Supplies listed in
zero rated or exempt Section 11 of Act Section 12 of Act
Micro business CAN’T register for vat
Vat only claimable if goods purchased for purpose of making taxable supplies. If only part used then
can only claim part of input vat UNLESS 95% or more used for taxable supplies then can claim full
input vat.
Only fringe benefits and indemnity payments in output vat are apportioned.
Vat levied on imported goods :
customs value + 10% + customs duty + import charges x 14% = vat payable
If imported services then must pay vat on portion that is used for exempt supplies NOT if used for
vatable supplies
If vendor has paid vat on imported services then can’t claim it back as input tax – cos it is non-taxable
supply.
Zero-rated supplies
Tax3761 Exam Summary notes
Explains each chapter in a simple understandable form.
, 1
TXN203D - summary
Framework for calculation of taxable income :
R
Gross income xxx (gross income general definition & specific
inclusions)
less : exempt income (xx)
Income xxx
less allowable deductions (xx) (general deduction formula, specific deductions
& capital allowances)
Taxable income xxx (from revenue activities)
add Taxable Capital Gain xxx
Taxable income xxx
If given amount including vat 100/114
If want to calc vat owing on amount 14/114
Output vat = vat levied on sold goods
Input vat = vat that can be claimed back from purchase of goods.
Taxable supply
Standard rate supply Zero rated supply Exempt supply
14% 0% no vat
Supplies that are not Supplies listed in Supplies listed in
zero rated or exempt Section 11 of Act Section 12 of Act
Micro business CAN’T register for vat
Vat only claimable if goods purchased for purpose of making taxable supplies. If only part used then
can only claim part of input vat UNLESS 95% or more used for taxable supplies then can claim full
input vat.
Only fringe benefits and indemnity payments in output vat are apportioned.
Vat levied on imported goods :
customs value + 10% + customs duty + import charges x 14% = vat payable
If imported services then must pay vat on portion that is used for exempt supplies NOT if used for
vatable supplies
If vendor has paid vat on imported services then can’t claim it back as input tax – cos it is non-taxable
supply.
Zero-rated supplies
