CASE STUDY You are a junior tax manager in the taxation department of Bean Counter & Co, a large regional accountancy practice based in Hull, East Yorkshire. The Tax Manager (who is your line manager and supervisor) is Mrs Angela Brown. She is self-isolating at home with her husband and children because one of her relations has tested positive for Covid-19. In her absence she has asked you to look at some client work and prepare detailed responses ready to discuss with her on her return to work. She has given you the following client files to work on whilst she is away. Summarised file contents are given below, together with details of the work you are required to complete: File 1 - Jackie White and her parents, Bill and Brenda White (a) Jackie is employed as a sales manager by The Hull Cookie Company Ltd (THCC). Her salary is 38,000 per annum. The following information is also relevant: THCC provided Jackie with a Ford Focus Petrol 5-door hatchback car which she used for private purposes as well as business. The list price is 18,600 and the CO2 emissions are 110g/km. Jackie had the use of this car for the whole of the tax year. Jackie drove 15,000 business miles during 2019-20. She paid for all of the fuel herself and the company reimbursed her for her business mileage at the rate of 35p for every mile. Jackie was a member of the company's private health insurance scheme throughout the year. The premium which THCC paid for her for 2019-20 was 850. In January 2019 THCC made Jackie a loan of 25,000 to fund the deposit when she purchased her own home. THCC charges her 2% interest per annum and the official rate of interest is 2.5%. Angela requires you to do the following: (0) Calculate the total value of Jackie's Benefits in Kind for 2019-20. Show your calculations in detail. 7 marks (ii) Calculate the amount which Jackie can deduct for tax purposes under the Approved Mileage Allowance Payment (AMAP) scheme. State the amount which Jackie has been over- or under-reimbursed by THCC. 3 marks Total marks for part 1(a) = 10 (b) Jackie's parents, Bill and Brenda White, have been married for 60 years. Bill was born in 1930 and Brenda was born in 1936. Bill had the following income for 2019-20: State pension 11,250 Private pension 8,000 Bank and building society interest 3,900 Dividends 7,450 Brenda's income consisted of the state pension only (8,400 for 2019-20). (File 1 is continued on the next page) (File 1 continued) Angela requires you to do the following for Bill: Prepare Bill's income tax computation for 2019-20 and calculate his tax liability. Marks for part 1(b) = 10 Total marks for Scenario 1: 20 CASE STUDY You are a junior tax manager in the taxation department of Bean Counter & Co, a large regional accountancy practice based in Hull, East Yorkshire. The Tax Manager (who is your line manager and supervisor) is Mrs Angela Brown. She is self-isolating at home with her husband and children because one of her relations has tested positive for Covid-19. In her absence she has asked you to look at some client work and prepare detailed responses ready to discuss with her on her return to work. She has given you the following client files to work on whilst she is away. Summarised file contents are given below, together with details of the work you are required to complete: File 1 - Jackie White and her parents, Bill and Brenda White (a) Jackie is employed as a sales manager by The Hull Cookie Company Ltd (THCC). Her salary is 38,000 per annum. The following information is also relevant: THCC provided Jackie with a Ford Focus Petrol 5-door hatchback car which she used for private purposes as well as business. The list price is 18,600 and the CO2 emissions are 110g/km. Jackie had the use of this car for the whole of the tax year. Jackie drove 15,000 business miles during 2019-20. She paid for all of the fuel herself and the company reimbursed her for her business mileage at the rate of 35p for every mile. Jackie was a member of the company's private health insurance scheme throughout the year. The premium which THCC paid for her for 2019-20 was 850. In January 2019 THCC made Jackie a loan of 25,000 to fund the deposit when she purchased her own home. THCC charges her 2% interest per annum and the official rate of interest is 2.5%. Angela requires you to do the following: (0) Calculate the total value of Jackie's Benefits in Kind for 2019-20. Show your calculations in detail. 7 marks (ii) Calculate the amount which Jackie can deduct for tax purposes under the Approved Mileage Allowance Payment (AMAP) scheme. State the amount which Jackie has been over- or under-reimbursed by THCC. 3 marks Total marks for part 1(a) = 10 (b) Jackie's parents, Bill and Brenda White, have been married for 60 years. Bill was born in 1930 and Brenda was born in 1936. Bill had the following income for 2019-20: State pension 11,250 Private pension 8,000 Bank and building society interest 3,900 Dividends 7,450 Brenda's income consisted of the state pension only (8,400 for 2019-20). (File 1 is continued on the next page) (File 1 continued) Angela requires you to do the following for Bill: Prepare Bill's income tax computation for 2019-20 and calculate his tax liability. Marks for part 1(b) = 10 Total marks for Scenario 1: 20