Anika Pillay, 45 years of age, runs her events management business as a sole proprietor. The following information is relevant for tax purposes for the year ended February 2019:
1. Her business, “Balloon Events”, had the following income and expenses during the 2019 tax year.
- Fee income R 568 950
- Client entertainment R 42 540
- Cell phone R 48 000
- Computer expense R 9 850
- Assistant’s salary R 72 000
- Motor vehicle expenses (excluding wear and tear) R 16 450
- School fees for her daughter R 28 0002. Anika purchased her motor vehicle on 4 May 2016 for an amount of R 159 500 including 15% VAT. She kept a log book during the tax year, according to which she travelled a total of 22 370km, 7 015km was for private purposes. SARS accepts a 5 year write off period on motor vehicles.
3. Anika purchased office furniture costing R 14 500 on 30 June 2016. SARS accepts a write off period of 6 years for furniture.
4. Anika uses a study in her house as her office. Her office is 15m2 and her entire house is 175m2. She has used this area exclusively as her office since 1 March 2015. The following expenses relate to the entire house for the 2019 tax year: - Electricity R 10 452
- Rates R 14 800
- Bond interest R 63 150
- Security services R 4 5005. Anika sold her house on 30 June 2018 for an amount of R 2 265 000. She had originally purchased the house for R 1 200 000 on 1 July 2006. In addition, she incurred the following expenses during her ownership:
- Transfer duties on purchase R 60 000
- Costs of adding a scullery to the kitchen R 54 500
- Agent’s fees on the sale R 90 600
- Bond repayments R 299 000
- Legal fees on the sale R 6 9856. Anika donated shares to her sister on 15 July 2018. The shares had a market value of R 96 850. She had purchased these three years earlier at a cost of R 63 500. She paid donations tax of R 19 370 on this donation.
7. She sold three Krugerrands on 1 November 2018 for R 15 600 each that she had inherited from her grandmother three years earlier. The market value at the date of inheritance was R 16 000 each.
8. She had an assessed capital loss of R 6 500 carried forward from the previous year.
9. Anika based her 2 nd provisional tax payment on the basic amount, and during the 2019 tax year made the following provisional tax payments:
31 August 2018 R 14 750
28 February 2019 R14 750
Required:
Calculate Anika Pillay’s tax owing for the year ended 28 February 2019.