During the fiscal year of 2023/24, John received £40 of income tax repayment interest relating to overpaid income tax from 2022/23. John has been employed part-time by Medical Support Ltd since 2013. He received the following remuneration package in 2023/24: · Salary £15,000 per year; · Eye test which would have cost £20, offered to all employees who use computers. · Private medical insurance costing the company £800, and which would have cost John £1,000 had he bought it directly from the insurers; and · From 1 June 2023, use of a van for significant private use with CO2 emissions of 130 g/km. The van had a list price of £10,000 and Medical Support Ltd paid for all John’s private fuel. John received £1,500 of dividends in January 2024 from an ISA. John has also run his own business as a sole trader for many years. Therefore, he has calculated his taxable trading profits for 2023/24 to be £20,600. In arriving at his taxable trading profits, he deducted the following amounts. · £200 donation to a national political party; · £560 pension contribution in respect of an employee, accrued in March 2024, but paid in late April 2024; · £1,000 written off in respect of a trade debt; and · £870 of depreciation in respect of office equipment. Required: Compute John taxable income for the fiscal year 2023/24.
During the fiscal year of 2023/24, John received £40 of income tax repayment interest relating to overpaid income tax from 2022/23. John has been employed part-time by Medical Support Ltd since 2013. He received the following remuneration package in 2023/24: · Salary £15,000 per year; · Eye test which would have cost £20, offered to all employees who use computers. · Private medical insurance costing the company £800, and which would have cost John £1,000 had he bought it directly from the insurers; and · From 1 June 2023, use of a van for significant private use with CO2 emissions of 130 g/km. The van had a list price of £10,000 and Medical Support Ltd paid for all John’s private fuel. John received £1,500 of dividends in January 2024 from an ISA. John has also run his own business as a sole trader for many years. Therefore, he has calculated his taxable trading profits for 2023/24 to be £20,600. In arriving at his taxable trading profits, he deducted the following amounts. · £200 donation to a national political party; · £560 pension contribution in respect of an employee, accrued in March 2024, but paid in late April 2024; · £1,000 written off in respect of a trade debt; and · £870 of depreciation in respect of office equipment. Required: Compute John taxable income for the fiscal year 2023/24.
Chapter2: Income Tax Concepts
Section: Chapter Questions
Problem 45P
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Question
During the fiscal year of 2023/24, John received £40 of income tax repayment interest relating to overpaid income tax from 2022/23. John has been employed part-time by Medical Support Ltd since 2013. He received the following remuneration package in 2023/24:
· Salary £15,000 per year;
· Eye test which would have cost £20, offered to all employees who use computers.
· Private medical insurance costing the company £800, and which would have cost John £1,000 had he bought it directly from the insurers; and
· From 1 June 2023, use of a van for significant private use with CO2 emissions of 130 g/km. The van had a list price of £10,000 and Medical Support Ltd paid for all John’s private fuel.
John received £1,500 of dividends in January 2024 from an ISA.
John has also run his own business as a sole trader for many years. Therefore, he has calculated his taxable trading profits for 2023/24 to be £20,600. In arriving at his taxable trading profits, he deducted the following amounts.
· £200 donation to a national political party;
· £560 pension contribution in respect of an employee, accrued in March 2024, but paid in late April 2024;
· £1,000 written off in respect of a trade debt; and
· £870 of depreciation in respect of office equipment.
Required: Compute John taxable income for the fiscal year 2023/24.
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