Chapter 3 – Property Income and Investments – Individuals – ACCA Taxation (TX-UK) lectures
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In the OpenTuition text book, for Example 1, the answer for the accrual basis is 5,300 – can I confirm that this is an error and the answer is actually 3,700 as per the video?
It is an error, they added the allowable expenses as opposed to subtracting them from the Rental income
Property business income
Sale Ltd jets out an office building which is surplus to requirements, although the property was empty between 1 July 2021 and 31 August 2021 Income and expenditure for the year ended 31 March 2022 is:
Date received(paid)
Insurance for the year ended 31 March 2022 (1400) paid on 1 April 2021
Rent for the quarter ended 30 June 2021
6300 received on 1 April 2021
10 July 2021
Repaid security deposit of one month’s rent
(2,100)
5 August 2021
Decorating the office building
(3,700)
12 August 2021
Advertising for tenants
(800)
1 September 2021
Premium for a 12-year lease
15,000
1 September 2021
Rent for the year ended 31 August 2022
27,000
What is the property income?
I just want to say thank you to the Teacher. THANK YOU!!
My pleasure
For Part 1 Video Example 1 Accurals Basis the Answers – Page 223 of Lecture notes they have added the 800 expenses and posted the income as 5300 Why??
Please explain how 4500 is calculated (in arrears) time stamp 04:36 – 04:44 (Video 1)
Because the fourth payment in arrears of 1500 is on 30 June 2023 which is after the end of the tax year.
Why in example one, she used 4500 for the in arrears?
It’s the figure multiply by 9 months divided by 12 months to get 4500
i dont understand why in example 1 the rent is taken for 11 months shout it not be from july 2022 to march 2023 9 months rent?
When the miss was explaining the example, she took 11 months instead of 12 bcoz of the 1 month missing (when the tenant did’nt pay )
as they have said that the annual rent is 9600……Even i got confused with it……now for exam i hope they pose easy question……but whether you are taking 11 months or 9 months …,make sure to make a NOTE in the answer that u have assumed (…) .as this was said by the miss in her lectures to write a note when u don’t understand……….this will definitely fetch u some marks even if u are wrong
I really like the lectures,Thanks.
I have a question though,on the lectures in example 1 we have taken redecorations as deductible expense but in example 2 we didnt.
Any reason for that?
Because the redecorations expense occured in 2023 so it will be deducted in the tax year 2023/24