TUTORIAL
QUESTION 1
Mrs Pamela is the managing director of T Co Ltd and derives a monthly
salary of Rs 105,000 together with 1 month end of year bonus. Every year,
she is granted 2 return Mauritius-Paris tickets worth Rs 70,000 each.
During the year ended 30 June 2023, she is paid dividends amounting to
Rs 25,000.
Compute total emoluments subject to tax.
QUESTION 2
Mr. Smith retired at the age of 65 on 01 September 2022. During the period
01 July 2022 to 31 August 2022, he derived a monthly emolument of Rs
50,000. A lump sum of Rs 2 million was paid to him in September 2022 and
a monthly pension of Rs 35,000 is paid as from September 2022. In
December 2022, he derived an end of year bonus (in relation to his past
employment) amounting to Rs 46,250. He also derived a monthly old age
pension of Rs 10,000 during the year ended 30 June 2023.
Compute his emoluments for the year ended 30 June 2023.
QUESTION 4
Mrs. Smith works in an aviation company (ABC Ltd) and she wins the
award “manager of the year” organised by the Management Institute. Mrs
Smith derived Rs 1,500,000 per year.
ABC Ltd organises a lunch to celebrate this event and a gift is offered to
Mrs. Smith. ABC Ltd spent Rs 150,000 for this event and the gift.
Is she taxable on the gift and the event? Justify your answer.
Compute the emolument amount taxable.
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QUESTION 5
Mr. John is employed at ABC Ltd. He earns a monthly salary of Rs
150,000 (Year ended 30 June 2022). As part of his pay package, he may
opt to be provided with either a 1700 cc company car or a monthly car
allowance of Rs 40,000. He opted for the car allowance. The car is
registered in his name and is used for his work.
Will he be taxable on the car benefit and what will be the amount? Justify
your answer.
Compute the amount of emoluments subject to tax.
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QUESTION 6
Mr. Tom works as a barman in a 5 star hotel and also serves food to
clients. During his duty, he received tips from customers.
Mr. Tom is provided free meals during his work.
Will Mr. Tom be subject to tax on the tips received and on the free meals?
QUESTION 7
Mr. Inder is an ACCA member and works as accountant in ABC Ltd. The
company policy provides for the payment of the annual subscription fees
amounting to some Rs 15,000 to ACCA on behalf of each qualified
employee.
Will the Rs 15,000 be subject to Income Tax?
QUESTION 8
Mr. Yash works in a government school as a Grade 6 teacher. He also
privates tuition on the school premises to his students after office working
hours.
Will the tuition fees be subject to Income Tax?
QUESTION 9
Mr. John works as manager in a 3 star hotel, ABC Ltd, since 15 January 2015. His remuneration
package comprises of the following:
(i) A monthly salary Rs 75,000 and one month bonus payable each December;
(ii) Car allowance Rs 40,000 per month. He used his car of Honda Fit which he bought in 2014 to
perform his duties.
(iii) One air ticket Mauritius-USA-Mauritius estimated at Rs 150,000 per annum.
(iv) Accommodation comprising of a fully furnished house rented at Rs 25,000 per month by the
employer.
During the year ended 30 June 2022:
(i) He was granted an interest free loan of Rs 1,000,000 (On 01 July 2021) by his employer. Repo
rate was 3.5% during the year ended.
(ii) ABC Ltd pays a gift of Rs 100,000 to him in May 2022 following the award received by him for
“most outstanding manager” from a renowned institute.
QUESTION 9
He enrolled for a course costing Rs 150,000 on management as he is often called upon to give
lectures on hotel management to staff.
Required:
(i) Compute the amount of emoluments which is subject to tax. Justify your answer.
(ii) State giving reasons whether expenses incurred in connection with course on presentation
skills is deductible against emoluments.
QUESTION 10
Mr Brand is a Zumba instructor and is paid a fixed sum of Rs 35,000 per month by Keep Fit Ltd, a
company which runs the fitness centre. The manager of the company is uncertain if PAYE should
be withheld from the amount.
Required:
(i) State any test that the manager need to be considered to ascertain whether Mr Brand is a self
employed or an employee.
(ii) For a sum of money to be considered as emoluments, the payment need not necessarily to
come from the employer. Discuss the statement by referring to 3 English tax cases and one
Mauritian tax case. You are required to give a brief summary of each case.
QUESTION 11
Mr Tom has been offered a job as Manager of R Co Ltd in July 2021 for a monthly salary of Rs
90,000. During negotiation for his package, he is given three options as regards car benefit:
Option 1 - The use of 1600 cc company car of make BMW for which all motor vehicle expenses will
be met by the company (except the cost of tyres amounting to Rs 1,000 per month). Petrol
expenses will amount to Rs 9,000 per monthly (approximately).
Option 2 – A car allowance of Rs 35,000 per month if he used a car registered in his name to
perform his duties.
Option 3 – A car loan of Rs 1,000,000 on which interest at rate 3% is applied coupled with the
option to purchase a duty free car. Assume the repo rate is 4%.
Required:
Evaluate the total emoluments of each option for the year ended 30 June 2022.
