- 16 Marks
PT – July 2023 – L2 – Q3a – Income Tax Liabilities
Calculation of loan benefits for three employees based on their loan details and income.
Question
The table below shows the incomes of three employees of Agana Ltd in 2022 year of assessment.
| Income Details | Adom | Aseda | Ayeyie |
|---|---|---|---|
| Basic Salary (GH¢) | 120,000 | 160,000 | 180,000 |
| Medical Allowance (5% of Basic Salary) | 6,000 | 8,000 | 9,000 |
| Rent Allowance (10% of Basic Salary) | 12,000 | 16,000 | 18,000 |
| Fuel Allowance (15% of Basic Salary) | 18,000 | 24,000 | 27,000 |
| Total Cash Emoluments | 156,000 | 208,000 | 234,000 |
Besides the cash emoluments stated above, the employees received loans from the employer as follows:
i) Adom received a loan of GH¢24,000 at a rate of 5% payable within 12 months.
ii) Aseda received a loan of GH¢48,000 at a rate of 8% payable within 24 months.
iii) Ayeyie received a loan of GH¢100,000 at a rate of 10% payable within 36 months. This loan is in addition to an outstanding loan of GH¢50,000 with the same terms and conditions during the previous twelve months. (Assume that the statutory rate is 30% per annum).
Required:
Determine the loan benefits applicable to each of the three employees for the 2022 year of assessment. (16 marks)
Find Related Questions by Tags, levels, etc.
- Tags: Employee Benefits, Employment Income, Income Tax, Loan Benefits, Tax computation
- Level: Level 2
- Topic: Income Tax Liabilities
- Series: JULY 2023