PART B $(10$ marks, $18$ minutes$)$Soothe $($Pty$)$ Ltd is a South African company that operates a chain of luxury boutique hotels acrossmajor cities in South Africa. In the financial year ended $29$ February $2024,$ Soothe Ltd undertook aDear Tax Manager,My name is Vuyo Mqalo and am a hairdresser in Khayelitsha, Cape Town. I am writing to youseeking guidance on the best way to structure my business taxes.On $1$ March $2022$ I opened a natural hair salon called Own Your Crown $($Pty$)$ Ltd in the township.I was informed that I was not compelled to register for VAT so I never did. However, I was recentlyinformed that I could qualify as a microbusiness.During the financial year that ended on $28$ February $2023,$ I generated a total income of R$750000$which was really good given that it was my first year of trading. In respect of the financial yearending on $29$ February $2024,$ my income and expenditure were as follows:Income: services rendered R$456000$Income: sale of natural hair products R $37000$Western Cape government grant R $50000$Interest received from bank account R $10500$Proceeds from sale of old hair dryers R $14500$Purchase of new hair dryers $($R $23600)$Rental paid $($R $16400)$Various trading expenses incurred $($R $44000)$Assessed loss carried forward from $2023($R$3500)$Doubtful debt allowance $2023($R$5000)$I would like you to kindly advise me on the following:$1.$ Do I qualify to register under the turnover tax system for the $2024$ year of assessment?$2.$ What would my turnover tax liability for the $2024$ year of assessment be assuming thatI qualify to register under the turnover tax system?I am looking forward to any assistance you may oer me in this regard.Regards,Vuyo Mqalomajor renovation of its flagship hotel in Cape Town. The renovation included structural changes tothe building to enhance its historical facade, the addition of a new spa and wellness center, and acomplete overhaul of its IT infrastructure to implement state$-$of$-$the$-$art guest service technology.The total expenditure for the renovation amounted to R$25$ million, broken down as follows: R$10$ million on structural enhancements to enhance the historical facade. R$5$ million on the spa and wellness center. R$10$ million on upgrading the IT infrastructure.Soothe Ltd aims to treat the entire R$25$ million as a deductible expense in its taxable income for the$2024$ year of assessment. The company argues that the expenditure is wholly and exclusively forthe purpose of its trade and should therefore be deductible under Section $11($a$)$ of the Income TaxAct.REQUIRED: MarksAs a tax consultant, you are required to discuss and apply the provisions of Section$11($a$)$ read together with section $23($g$)$ of the Income Tax Act to the expenditureincurred by Soothe Ltd$.$Your discussion should focus on the following: Whether the expenditure incurred by Soothe Ltd meets the requirement of being"not of a capital nature" to qualify as a deductible expense. In your analysis, include references to relevant case law that deals with thedistinction between capital and revenue expenditure, particularly focusing onthe "capital in nature" aspect.