QUESTION THREE [10 MARKS] A few months ago, when John Depp, a resident of the Republic, left school at the age of nineteen years he was unable to find employment. He therefore commenced his own transport business. On 1 April 2019 he purchased a taxi for R228 000 under a suspensive sale agreement. (A relative acted as his guarantor). His passengers are some of the residents who live in the same suburb that he lives in. A few months later John Depp was forced to expand his business. His single taxi could not cope with all the passengers. During the first 11 months of business he: - leased a taxi (his business now has two taxis, the one he owns, and the one he leases); - employed two full-time assistant drivers; - had a turnover (all received in cash) of R760 000 (1 April 2019 to 28 February 2020) and - made a net profit of R500 000; The Commissioner had agreed that John Depp may claim the wear-and-tear allowance over a fouryear period on the cash cost of the taxi that he purchased. The wear-and-tear allowance and an allowance for the finance charges that he has incurred when he purchased his taxi under the suspensive sale agreement have been taken into account in determining the net profit of R500 000 . The lease rentals and the salaries paid to his two full-time assistant drivers have also been deducted in determining the net profit of R500 000 . John Depp trades in his own name. His accountant has prepared his financial statements and various tax returns for the year of assessment. He has suggested to John Depp that he should elect to tax his business under the tumover tax system. The reason for this suggestion is that it would be more tax efficient for John Depp. John Depp has invested his surplus funds in interest-bearing securities. He does not own shares in private companies. He is not a member of a close corporation or a partner in a partnership. During the year of assessment interest of R23 800 accrued to him from his interest-bearing securities. REQUIRED: Advise John Depp as to whether he should elect to be taxed as a micro business. Support your answer with calculations detailing his normal income tax liability (if he were not to choose the turnover tax system), as well as his tax liability if he were to choose the turnover tax system for the 2020 year of assessment