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Question 7: 5 marks

Your client will need to make tax instalments for 2020. She is uncertain how those instalments should be calculated, when they need to be paid, and the consequences of making inadequate instalments.

Actual tax liability for 2018: $9,100

Actual tax liability for 2019: $6,750

Estimated tax liability for 2020: $4,500

Required:

Calculate the options available and discuss the tax implications of paying late.

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