QUESTION -

Compute Elans tax liability for 2021/22, showing all workings. If an amount is not taxable enter a zero or explain that it is not taxable

INFORMATION -

Elan received 100 interest income from a building society ISA during 2021/22.

Elan has been employed part-time by DEF Ltd for many years. He received the following remuneration package in 2021/22:

salary 21,000 per year;

a bonus of 1,250 in respect of the year ended 31 March 2021, paid on 31 May 2021;

mobile phone, costing DEF Ltd 240 per annum; and

use of a petrol company car with a CO 2 emissions of 102 g/km, and a list price of 20,000.

The company also paid for all of Elans private fuel.

Elan received 112,000 of dividends in January 2022 from a UK company.

Elan has also run his own business as a sole trader for many years.

Elan has calculated his taxable trading profits for 2021/22 to be 44,100.

In arriving at his taxable trading profits, Elan deducted the following amounts:

1,200 written off as a bad debt because a customer has gone into liquidation;

50 parking fines incurred by an employee while visiting a customer;

600 in respect of entertaining clients at a summer party; and

50 paid to a local charity for which Elan received an advertisement for his business in the charitys newsletter.