Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Exhibit 4 Memo from Thabo Molefe From: Thabo Molefe To: Tax Manager Subject: Salary restructuring. Tonota Wholesalers employs Mussa Molelekwa. Kgari Distributors recently approached him
Exhibit
Memo from Thabo Molefe
From: Thabo Molefe
To: Tax Manager
Subject: Salary restructuring.
Tonota Wholesalers employs Mussa Molelekwa. Kgari Distributors recently approached him about working for them. Mussa seeks advice on whether the compensation package being offered by Kgari Distributors is superior to his present deal.
P
Current package from Tonota Wholesalers:
Annual salary
Anticipated bonus
Medical aid company contribution
Pension company contribution
Proposed package by Kgari Distributors:
Annual salary
Medical aid company contribution
School fees
Company house of square metres
Company car costing P
Mussa currently has the following annual outgoings:
House rentals
School fees
Costs of running his own car
Personal pension contribution to Tonota Wholesalers pension fund
REQUIRED:
Mussa Molelekwa's tax liability and net cash flow from each job package should be calculated, and you should advise him on whether to accept Kgari Distributors' offer after calculating these numbers.
Note: In your calculations of taxable income indicate any items which are not taxable using a zero. Marks
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started