Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA TX-UK Exams › Practice question 19 – Renner
- This topic has 1 reply, 2 voices, and was last updated 4 years ago by Tax Tutor.
- AuthorPosts
- February 15, 2020 at 6:53 am #561896
Hi
I urgently need to understand something for the Renner question:
Firstly, The question states the official rate of interest is 3%, however in the beneficial loan working in working 2 it states 2.5% – 2%. Where is the 2.5% derived from?
Secondly, when calculating the private benefit for the use of the yacht in part a of working 2, it states 20% x 42,000 x 2/52. Is the 20% in this working referring to his share of the ownership of the company or is it referring to the basic rate tax band?
Thanks
February 16, 2020 at 9:16 am #561974Firstly 2.5% is the official rate of interest given on your rates and allowances tables and used in the examples in the study notes. Unfortunately 3% is a typo error and should not be there – I though that it had been removed so apologies for that
Secondly – you should know that the generic rule for dealing with “other” assets made available for private use is 20% pa of the market value when first made available for private use as demonstrated in the notes and lectures (chapter 9 page 57) – “other” assets is simply any asset other than those that have their own specific rule (such as living accommodation, cars and vans) - AuthorPosts
- You must be logged in to reply to this topic.