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The year end of 31/03/19 in the video lecture is gotten as a result of the tax year of April 6th to April 5th? if no, please how was the year end date arrived at?
The formula given for the trading profit deduction for traders was :
Property Income assessment for landlord/Life of lease
However in your video lecture you used the Premium payment of 42,000 rather than the total property income assessment figure (ie 20,000 plus 42,000) please explain this. Thank you
1. No – as stated in the lecture we are in this example computing for the lessee what deductions are relevant to the accounting period in which the transactions occurred. Once the adjusted trading profit has been determined – NOT required in this example – how it is then assessed is dealt with in Chapter 4. The premium was paid during the lessee’s accounting year ended 31 March 2019 – it does not matter in which tax year the payments were made!
2. Once again as stated in the lecture we are computing what deduction is available in relation to the PREMIUM payment – we have already computed the deduction available for the accounting period in relation to the rental payment.
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