QUESTION $1$

Maureen is a sole trader and is registered for corporation tax. She has been specified by the Zimbabwean Revenue Authority $($ZIMRA$)$ to be taxed under the self$-$assessment system.

On $10$ August $2016,$ Maureen received an estimated assessment dated $31$ July $2016$ in respect of the year ended $31$ December $2015.$ The estimated assessment shows corporation tax payable of US $$18000.$

Maureen$$s accounting records show that her actual corporation tax payable for the year ended $31$ December $2015$ is US$ $26000,$ after taking into account provisional tax paid of US$$12000.$ Maureen believes that because the estimated assessment of the tax payable is favourable, is not obliged to submit an income tax return for the year ended $31$ December $2015.$

Required

$($a$)$ Outline the circumstance in which an estimated assessment can be issued by the Zimbabwe Revenue Authority $($ZIMRA$).$

$$ When a taxpayer has failed to submit a return on time;

$$ When a taxpayer is unable to submit an accurate return due to circumstances beyond the taxpayer$$s control;

$$ When a taxpayer has not kept proper accounting records.

$($b$)$ Briefly comment on Maureen$$s view regarding the estimated assessment she has received for the year ended $31$ December $2015.$

$$ View is incorrect as she is obliged to submit her annual income tax return on the stipulated date;

$$ The estimated assessment does not absolve Maureen from her statutory;

$($c$)$ Outline the tax consequences of Maureen$$s failure to submit an income tax return for the year ended $31$ December $2015$ include appropriate calculations to support your answer and also state the income tax return submission date and the due date for the payment of tax under the self$-$assessment system. $[25]$

$$ Return for the year ended $31$ December $2015$ should have been submitted on $30$ April $2016$

$$ Penalty for non$-$submission of the income tax return is calculated at US$$30$ for every day the return remain outstanding up to a maximum penalty of US$ $5430($$$30$ x $181$ days$)$

$$ For failing to remit the tax payable of $$26000$ on $30$ April $2016,$ a $100\%$ penalty is chargeable which amounts to US$$26000$;

$$ An interest of $10\%$ per year is chargeable on the outstanding tax for the period the amount remains unpaid;

The estimated assessment is a direct consequence of failure to submit the return on the stipulated date.

Notes

$($a$)$ Your answer should state the income tax return submission due date for the payment of tax under the self$-$assessment system.

$($b$)$ You should include the appropriate calculation to support your answer.