current tax expense

Question 1

taxable capital gain formula

Answer 1

proceeds (not limited)
less recoupment of wear and tear
answer
less tax base
(tax base = cost less cumulative capital allowances)

Question 2

relationship between tax base, recoupment and cost price

Answer 2

tax base +recoupment = cost price

Question 3

profit or loss on sale of an asset and capital profit included in profit on sale

Answer 3

proceeds on sale
less carrying amount

capital profit
proceeds on sale
less original cost
=capital profit on sale

Question 4

exe

Question 5

exempt portion of capital profit

Answer 5

capital profit
less taxable capital gain

Question 6

what causes permanent difference in current tax
*CGT

Answer 6

difference between IFRS profit on sale and SARS capital gain
*see alternative
therefore

less capital profit
add taxable capital gain
(capital gain x inclusion rate)

Question 7

prepaid expense adjustment in current tax

Answer 7

+opening balance
-closing balance

Question 8

income received in advance *current tax

Answer 8

-opening balance
+closing balance

Question 9

provision effect on current tax

Answer 9

• opening balance
  +closing balance

Question 10

tax base formula

Answer 10

cost
less accumulated wear and tear or accumulated tax deductions

Question 11

recoupment formula and effect on profit

Answer 11

proceeds ltd cost
less tax base

effect
-profit on sale
+recoupment

Question 12

scrapping allowance formula and effect

Answer 12

tax base
less proceeds ltd to cost

effect
+loss on sale
-scrapping allowance

Question 13

alternative current tax effect for sale of depreciable asset

Answer 13

permanent difference
less capital profit
add taxable capital gain

temporary difference
less non capital profit

Question 14

effective tax rate formula

Answer 14

income tax expense/ profit before tax

Question 15

components of tax rate reconciliation

Answer 15

items that cause differener between the effective rate and statutory rate