QUESTION 3 (48 marks) Elijah Jackson (59 years old) died on 1 December 2020. He is survived by his wife, Florence Jackson, to whom he was married out of community of property, with the accrual system applicable to their marriage. Both Elijah and Florence have always been residents of South Africa. The following information relates to Elijah's estate: Elijah owned a property in Cape Town, which was bought in 2001 for R1 350 000 The executor sold this property for R3 650 000, although the value of the property was R3 500 000 on the date of Elijah's death. Elijah had an apartment valued at R600 000 on the date of his death. He inherited the apartment from his father on his death (Elijah was 50 at the time) on condition that he must leave it to his son, Anouk Anouk was 28 years old on the date of Elijah's death. Elijah did not pay nor bear any of the estate duty payable in his father's estate Elijah owned property in Johannesburg, which is occupied by his sister, Delilah. The property was bought for R400 000 and had a value of R800 000 on the date of Elijah's death. Elijah bequeathed the property to his sister in his will. During Elijah's life, he approved improvements to the property made by his sister. These improvements cost Delilah R90 000 but added R200 000 to the property's value. Delilah had a policy on Elijah's life. The policy paid Delilah R120 000 on Elijah's death. Delilah paid all the premiums on the policy, amounting to R40 000. Interest calculated on the premiums at 5% per annum amounted to R2 000. The executor of the estate calculated that Elijah's accrual in the estate since his marriage amounts to R1 300 000. Florence's accrual in the estate since married amounts to R1 000 000. Elijah's bank account with a local bank was in overdraft on the date of his death, amounting to R50 000. Advertising costs of R1 000, executor's remuneration of R150 000 and funeral costs of R28 000 were incurred in the winding up of the estate. Elijah's IRP5 for the period 1 March 2020 until the date of his death showed a gross salary earned of R620 000 and employee's tax paid of R154 509. None of the properties owned by Elijah were his primary residence. . . 65 HTAX332-1-Jul-Dec2021-FA1-V3-BL-26072021 ANNEXURE F: FORMATIVE ASSESSMENT 1 Required: 3.1. 3.2. Calculate the normal tax due for Elijah for the 2021 year of assessment (16 marks) Calculate the normal tax due for the deceased estate for Elijah for the 2021 year of assessment. (8 marks) Calculate the estate duty payable on Elijah's deceased estate and indicate an apportionment if applicable. (24 marks) 3.3. QUESTION 3 (48 marks) Elijah Jackson (59 years old) died on 1 December 2020. He is survived by his wife, Florence Jackson, to whom he was married out of community of property, with the accrual system applicable to their marriage. Both Elijah and Florence have always been residents of South Africa. The following information relates to Elijah's estate: Elijah owned a property in Cape Town, which was bought in 2001 for R1 350 000 The executor sold this property for R3 650 000, although the value of the property was R3 500 000 on the date of Elijah's death. Elijah had an apartment valued at R600 000 on the date of his death. He inherited the apartment from his father on his death (Elijah was 50 at the time) on condition that he must leave it to his son, Anouk Anouk was 28 years old on the date of Elijah's death. Elijah did not pay nor bear any of the estate duty payable in his father's estate Elijah owned property in Johannesburg, which is occupied by his sister, Delilah. The property was bought for R400 000 and had a value of R800 000 on the date of Elijah's death. Elijah bequeathed the property to his sister in his will. During Elijah's life, he approved improvements to the property made by his sister. These improvements cost Delilah R90 000 but added R200 000 to the property's value. Delilah had a policy on Elijah's life. The policy paid Delilah R120 000 on Elijah's death. Delilah paid all the premiums on the policy, amounting to R40 000. Interest calculated on the premiums at 5% per annum amounted to R2 000. The executor of the estate calculated that Elijah's accrual in the estate since his marriage amounts to R1 300 000. Florence's accrual in the estate since married amounts to R1 000 000. Elijah's bank account with a local bank was in overdraft on the date of his death, amounting to R50 000. Advertising costs of R1 000, executor's remuneration of R150 000 and funeral costs of R28 000 were incurred in the winding up of the estate. Elijah's IRP5 for the period 1 March 2020 until the date of his death showed a gross salary earned of R620 000 and employee's tax paid of R154 509. None of the properties owned by Elijah were his primary residence. . . 65 HTAX332-1-Jul-Dec2021-FA1-V3-BL-26072021 ANNEXURE F: FORMATIVE ASSESSMENT 1 Required: 3.1. 3.2. Calculate the normal tax due for Elijah for the 2021 year of assessment (16 marks) Calculate the normal tax due for the deceased estate for Elijah for the 2021 year of assessment. (8 marks) Calculate the estate duty payable on Elijah's deceased estate and indicate an apportionment if applicable. (24 marks) 3.3
