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Hello, in Example 13 the gross Gift Aid payment (£2000) is not deducted from the net taxable income, but it is in Example 14 (£8000). Why is this? Thank you.
These examples are from the lecture below:
Deductions from Total Income, Gift Aid and Personal Pension Contributions – ACCA TX Exam FA2019
Gift Aid payments are NOT deducted in deriving the taxable income of the taxpayer in either example – and indeed are never deducted in computing the figure of taxable income on any income tax computation.
The difference between these 2 examples is that in example 13 the figure of ADJUSTED NET INCOME as defined in the study notes and lectures and separately computed where necessary in a working – does not exceed £100,000 and therefore the full PA is available.
In example 14 – the figure of adjusted net income (shown in the working) does not only exceed £100.000, it exceeds £125,000 and therefore NO PA is available – as again is stated in the answer.
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