Question Mr. George Amoako commenced business on 1st April, 2017 and submitted the following extracts of his financial statements for the year ended 31st March, 2018 and 2019 to Ghana Revenue Authority. Ghana Revenue Authority is yet to audit and assess the accounts of Georges Business since its commencement. Income Statement for the year ended 31st March, 2019 2018 GH GH Gross profit 99,000 43,332 Salary (Note 1) (30,000) (35,000) Computer purchased (Note 3) (35,000) (29,200) Office Equipment (Note 3) - (6,000) Employers SNNIT Contribution (6,000) (5,000) Contribution and Donation (Note 2) (9,000) (8,000) Carry over loss from 2017-2018 year (Note 4) (19,000) - Net Profit or (Loss) - (39,868)

Additional Information

Note 1 Salary Mr. George Personal salary 6,000 8,000 Other Permanent Staffs salary 4,000 3,000 Wages paid to Casual worker 20,000 24,000 30,000 35,000 Note 2 Contribution and donation Ghana Heart Foundation 5,500 4,000 Approved religious Institution 2,000 2,000 Custom Officials 1,500 2,000 9,000 8,000

Note 3 Tax Rates

Corporate Tax Rate for 2018 year of assessment is 25% and

Annual Graduated Tax Rate for 2018 year of assessment is shown below

First GH3,132 Nil

Next GH840 5%

Next GH1,200 10%

Next GH33,720 17.5%

Next GH38,892 25%

Exceeding 120,000 35%

Note 4 Carry-Over Loss

Mr George decided to carry-over the denied loss of GH20,868 (i.e 39,868 19,000) from the year ended 31st March 2019 to 31st March 2020 year-end.

Note 5 Acquisition of depreciable assets Asset

Date of Acquisition Amount (GH) Computers 01/12/2017 29,200 Equipment 01/03/2018 6,000 Computers 01/06/2018 35,000

Required

i. Compute Mr. Georges Taxable income and Tax liability for the 2018 year of assessment. (14 marks)

ii. Provide notes to support your computation (6 marks)

iii. In furtherance of section 17 of Act 896, comment on Georges decision to carry-over an unrelieved loss of GH 20,868 to 31st March 2020 year-end. (4 marks) iv. Determine Mr Georges obligation on payment of Wages to Casual worker in respect of 2018 year of assessment for taxation purposes. (2 marks)