TAX1501 ASSIGNMENT 2 SEM 1 OF 2026 EXPECTED QUESTIONS AND ANSWERS

, QUESTION 1

Part 1 – Taxable Income & Normal Tax
Liability Calculation (Medical Tax Credits
Ignored)


Step 1: Calculate Gross Income

Item Amount (R)
Salary 1,230,000
Investment income (see
-
note 1)
Local dividends 40,200
Local interest 28,900
Rental income 34,000
Gross Income 1,333,100
Step 2: Determine
Exempt Income
Item

Local dividends – exempt
40,200
(section 10(1)(k))


Local interest – exemption
for taxpayer aged 65+ 34,500
(section 10(1)(i))


Step 3: Calculate Income
after Exemptions

Item Amount (R)
Gross Income 1,333,100
Less: Local dividends
-40,200
exempt

Less: Local interest exempt -34,500


Income after exemptions 1,258,400