Question .No 3

MaximumMarks10

During the tax year 2020 (1^st July 2019 till 30^th June 2020), following transactions were carried out in respect ofthe properties:

(i)On 1 July 2019, Zaki purchased a factory building in Sukkur along with the installed machinery at the price of Rs. 9 million and Rs. 3 million respectively. To manage the shortage of funds of Rs. 2,000,000, he borrowed the same on 1 July 2019 from his friend Shahid through a crossed cheque. The loan carries interest at the rate of 18% per annum.

On 1 January 2020, he let out this building along with the machinery to Basitat a monthly rent of Rs. 500,000 payable in advance.

Compute Taxable Income of Zaki?

(ii)For tax year 2020, Zakilet out his residential property situated in DHA Karachi to ABC Limited at a monthly rent of Rs. 300,000. Rent for the two years was received in advance. However, Mr. Zaki has to incurred Rs. 50,000/- on repairs of the rented premises and provided sum of Rs. 50,000/- to DHA annual maintenance charges and Rs. 100,000/-, to Clifton Cantonment for the sum of Rs.100,000/-

Compute Taxable Income of Zaki?

(iii)Mr. Zaki had let out the property to Mr. Azam for a sum of Rs 500,000 per month in July 2019. Mr. Azam has paid a sum of Rs 1,000,000 as non-adjustable deposit.

After the expiry of two years, Mr. Azam vacated the premises and Mr. Zaki returned the deposit to Mr. Azam. Thereafter, Mr. Ali acquired the possession of the rented premises for the sum of Rs. 700,000/-. The amount of nonadjustable deposit was also increased to Rs 1,200,000.

Compute the taxable income of Mr. Zaki from the said property and related tax liability for the years 2020? (tax slabs are mentioned in slide No.6 of chapter Property Income)

(iv)M/s XYZ Private limited rented their property to M/s D Limited for a sum of Rs 2,000,000/- per monthfor tax year 2020 . M/s D has paid a sum of Rs 10,000,000 as non-adjustable deposit.

During the year under consideration, M/s XYZ has incurred following:-

-Rs.7,000,000/- on repairs and maintenance

-Rs.100,000 on insurance premium

-Administrative expenses for the sum of Rs.2,400,000/-

-Rs.500,000/- on ground rent paid to Government of Sindh

Compute taxable income of XYZ Private Limited?