PRINCIPLES OF TAXATION

Summary of Marking Key

Certificate in Accounting and Finance – Spring 2017

Note regarding marking scheme:

The marking scheme is given as a guide. However, markers also award marks for alternative
approaches to a question and relevant/well-reasoned comments/explanations. Moreover, the
available marks in a question may exceed the total marks.

Mark(s)
A.1
Computation of the admissible / inadmissible expenses and income
− Bad debts 3.0
− Depreciation – accounting and tax 3.0
− Intangibles 3.0
− Up to 01 mark each for all other items 3.5

Computation of income from capital gain 2.0

Computation of net tax payable 1.5

A.2 (a) Explaining the term ‘disposal of assets’ 5.0

(b) (i)
Identification of the cost that should be taken into account for
determining the gains / loss on sale of painting 1.0

The taxability of the gain/loss on sale of painting 1.0

(ii)
Identification of the cost that should be taken into account for
determining the gains / loss on sale of jewellery 1.0

The taxability of the gain/loss on sale of jewellery 1.0

(iii)
Explanation for not inclusion of car as capital asset 1.0

The taxability of the gain/loss on sale of car 1.0

(iv)
Discussion on the rule for treatment of movable property held for
personal use 1.0

The taxability of the gain/loss on sale of dining table 1.0

A.3 (a) Computation of:

income from property 4.0

income from other sources 4.0

(b)
Explanation of the tax treatment of the amount forfeited 1.0

Explanation of the tax treatment of the amount received from the sale of
the property 3.0

A.4 (a) 01 mark for each duty of the National Finance Commission 4.0

(b)
01 mark for mentioning each type of tax which may be raised under the
authority of Parliament 2.5

01 mark for mentioning each type of tax covered under the scope of
legislation of the provinces 3.5

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 PRINCIPLES OF TAXATION
Summary of Marking Key
Certificate in Accounting and Finance – Spring 2017

Mark(s)
A.5 (a) Up to 01 mark for identification of each type of persons who are required to
furnish a return of income 6.0

(b) (i) 0.75 mark for each situation under which the Commissioner of Income
Tax may require a person to furnish a return of income for a period of less
than twelve months 3.0
(ii) Explaining the consequences if a person fails to furnish the return as
required in (i) above 3.0

A.6
Preparation of wealth statement 4.0

Preparation of wealth reconciliation statement 3.0

A.7
Computation of:

− input tax on fixed assets and its treatment 1.5
− input tax for the month 4.0
− output tax for the month 4.0
− further tax and its treatment 1.0

Apportionment of input tax 1.5

Computation of admissible credit and sales tax payable 2.5

Determination of sales tax payable 1.0

Determination of input tax to be carried forward 1.0

Determination of refund on zero rated supplies 0.5

A.8 (a) (i) 0.5 mark for identification of each circumstances under which a registered
person is not allowed to reclaim or deduct input tax paid 6.0
(ii) 01 mark for identification of each circumstances under which a registered
person is liable for deregistration 3.0

(b) Description of the procedures for rectification of mistake after the expiry of 180
days 4.0

(THE END)

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