T
, AX2601 Assignment 3 (COMPLETE ANSWERS) Semeste
r 2 2024 - DUE 2 September 2024 ; 100% T
RUSTED Complet
QUESTION 1 (12 marks) Easy Elevators (Pty) Ltd’s (“EE”) core
business is the maintenance of elevators in residential and
commercial buildings in the Gauteng region. It has service
agreements with each of its customers and in terms of these, a
monthly maintenance fee of R15 000 is payable on or before
the seventh (7th) day of each month before that month’s
service occurs. EE is a company incorporated in South Africa
and its year of assessment ends on 31 March. One of EE’s
customers paid an amount of R45 000 into EE’s bank account on
7 March 2024. This amount is for the maintenance service fees
in respect of the following three months i.e. March 2024 to May
2024. EE was informed by the customer that the building’s
caretaker decided to pay three months’ fee upfront as he would
be out of the country for an extended period and wanted to
ensure the maintenance of the elevators would continue as
usual during this time. REQUIRED MARKS Discuss whether the
receipt of the R45 000 maintenance service fee would
constitute gross income of Easy Elevators (Pty) Ltd as defined in
the Income Tax Act 58 of 1962 for the year of assessment
ending 31 March 2024. List all the gross income definition
requirements, discuss each one and briefly refer to case law to
strengthen your argument. 12 4 TAX2601/2024/Semester
2/Assessment 3
, AX2601 Assignment 3 (COMPLETE ANSWERS) Semeste
r 2 2024 - DUE 2 September 2024 ; 100% T
RUSTED Complet
QUESTION 1 (12 marks) Easy Elevators (Pty) Ltd’s (“EE”) core
business is the maintenance of elevators in residential and
commercial buildings in the Gauteng region. It has service
agreements with each of its customers and in terms of these, a
monthly maintenance fee of R15 000 is payable on or before
the seventh (7th) day of each month before that month’s
service occurs. EE is a company incorporated in South Africa
and its year of assessment ends on 31 March. One of EE’s
customers paid an amount of R45 000 into EE’s bank account on
7 March 2024. This amount is for the maintenance service fees
in respect of the following three months i.e. March 2024 to May
2024. EE was informed by the customer that the building’s
caretaker decided to pay three months’ fee upfront as he would
be out of the country for an extended period and wanted to
ensure the maintenance of the elevators would continue as
usual during this time. REQUIRED MARKS Discuss whether the
receipt of the R45 000 maintenance service fee would
constitute gross income of Easy Elevators (Pty) Ltd as defined in
the Income Tax Act 58 of 1962 for the year of assessment
ending 31 March 2024. List all the gross income definition
requirements, discuss each one and briefly refer to case law to
strengthen your argument. 12 4 TAX2601/2024/Semester
2/Assessment 3
