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i) Duty free shop
It means a room or premises situated in a port and licensed by the commissioner for the deposit of dutiable goods on which duty has not been paid and which have been entered to be warehoused for use as a ship stores or for sale to passengers departing to
places outside Kenya.
ii) Excisable goods
It means goods manufactured in Kenya or imported into Kenya on which an excise duty is imposed under the Customs and Excise Act. Examples of goods subject to excise duty include cigarettes, beer, shoes etc.
iii) Bonded warehouse
This is a warehouse used to store goods, whose VAT and other charges are secured by a bond. The warehouses are owned privately by persons licensed by the customs and excise department. They include bonded oil installations used to store petroleum products
Wilfykil answered the question on February 15, 2019 at 09:11
- Sabina and Associates, a consultancy firm, provided vatable services to the following clients over the eight month period ended 31 August 2009. The terms of...(Solved)
Sabina and Associates, a consultancy firm, provided vatable services to the following clients over the eight month period ended 31 August 2009. The terms of contract allowed clients to pay for the services either before or after the provision of service
Determine VAT payable by (or refundable to) Sabina and Associates for each of the months shown above. Although VAT contributes significantly to government revenue, it has limitations which impact on the government, taxpayers and the economy at large.
Explain six of these limitations.
Date posted: February 15, 2019. Answers (1)
- Explain the tax treatment of income received by life assurance companies(Solved)
Explain the tax treatment of income received by life assurance companies
Date posted: February 15, 2019. Answers (1)
- As a tax specialist, briefly explain how you would treat the following issues for tax purposes:
(i) Mr Jan Philips is an expatriate working for a...(Solved)
As a tax specialist, briefly explain how you would treat the following issues for tax purposes:
(i) Mr Jan Philips is an expatriate working for a non-resident company in your country. During the year ended 31 December 2008, he received a passage allowance of Sh400,000 to enable him visit his family in his horn country. He did not include the passage allowance as part of his employment income for the year ended 31 December 2008.
(ii) Trans Country Bus Services Ltd. runs a public service transport business in your country. The bus company also undertakes transport business across the borders to the neighbouring countries. The company did not include the revenue arising from cross- border transport amounting to Sh.2,000,000 in its tax returns for the year ended 31 December 2008.
(iii) During a business trip to Dubai, Mrs Agnes Latoya, a resident of your country, purchased ten suits for her husband's use at a cost of Sh.300,000. However, upon her return the husband did not like the suits.
Mrs Agnes Latoya thereafter sold the suits and realised a profit of Sh.50,000. She included this profit with her other income for the year ended 31 December 2008.
(iv) Rahani Hotels Ltd. offered the following services to foreign tourists for which it did not charge VAT:
- Restaurant services.
- Game drives.
(v) The revenue authority has written to the hotel demanding payment of the VAT on the above services.
Date posted: February 15, 2019. Answers (1)
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Outline the grounds upon which a taxpayer may appeal to the Court of Appeal in a tax dispute
Date posted: February 15, 2019. Answers (1)
- Explain Goods liable to forfeiture under the Customs and Excise Act(Solved)
Explain Goods liable to forfeiture under the Customs and Excise Act
Date posted: February 15, 2019. Answers (1)
- The following transactions were reported by Abdi Wholesalers for the three months period ended 31 December 2008
Determine Total VAT payable (or refundable) for the three...(Solved)
The following transactions were reported by Abdi Wholesalers for the three months period ended 31 December 2008
Determine Total VAT payable (or refundable) for the three months period (ignore restrictions on input tax deduct-able)
Date posted: February 15, 2019. Answers (1)
- The VAT Act requires a registered person to notify the Commissioner of changes in certain particulars of a business within 14 days of their occurrence.
Identify...(Solved)
The VAT Act requires a registered person to notify the Commissioner of changes in certain particulars of a business within 14 days of their occurrence.
Identify six of these business particulars
Date posted: February 15, 2019. Answers (1)
- With reference to the Income Tax Act (Cap.470), explain the term "incorrect returns".(Solved)
With reference to the Income Tax Act (Cap.470), explain the term "incorrect returns".
Date posted: February 15, 2019. Answers (1)
- The following transactions were extracted from the books of IB Trader; for till: month of September 2009:
Determine:
i) Value added tax payable by (or refundable to)...(Solved)
The following transactions were extracted from the books of IB Trader; for till: month of September 2009:
Determine:
i) Value added tax payable by (or refundable to) JB Traders tor the month of September 2009.
ii) Comment on any information that you have oat used in your computations under (i) above.
Date posted: February 15, 2019. Answers (1)
- Section 24 (a) of the Value Added Tax (VAT) Act (Cap.476) requires certain documents to be attached to a claim for refund of VAT.
Briefly explain...(Solved)
Section 24 (a) of the Value Added Tax (VAT) Act (Cap.476) requires certain documents to be attached to a claim for refund of VAT.
Briefly explain four of these documents.
Date posted: February 15, 2019. Answers (1)
- Describe three types of tax assessments that may originate from the Commissioner for Domestic Taxes.(Solved)
Describe three types of tax assessments that may originate from the Commissioner for Domestic Taxes.
Date posted: February 15, 2019. Answers (1)
- Explain four positive roles of excise duties in an economy.(Solved)
Explain four positive roles of excise duties in an economy.
Date posted: February 15, 2019. Answers (1)
- List three ways through which the revenue authority may enforce the collection of overdue tax.(Solved)
List three ways through which the revenue authority may enforce the collection of overdue tax.
Date posted: February 15, 2019. Answers (1)
- Mamba Stores Ltd. deals in a variety of vatable and non-vatable goods. The following transactions took place during the month of December 2009:
Determine:
(i) A value...(Solved)
Mamba Stores Ltd. deals in a variety of vatable and non-vatable goods. The following transactions took place during the month of December 2009:
December 1: Sold goods 011 credit to Wepesi Traders for Sh.100,000.
December 3: Purchased goods on cash basis from Riverside Traders for. 8h.98,000. December 4: Purchased electronic tax register for Sh.75,000 and paid by cheque.
December 8: Wepesi Traders returned goods valued at 8h.30,000 and received a credit note.
December 9: Sold goods to BB Ltd., a company based in Tanzania, for Sh.150,000. December 14: Paid electricity bills amounting to Sh.5,000.
December 15: Received a debit note of Sh.24,000 from Riverside Traders. December 18: Purchased office stationery for Sh.36,000.
December 21: Supplied goods to the Ministry of Agriculture valued at Sh.800,000. December 24: Imported goods from Dubai for Sh.400.000 exclusive of import duty of 25%
and value added tax of 16%
December 28: Purchased fuel for business vehicles for Sh.75,000. December 29: Paid Sh.34,000 for catering services.
December 30: Paid Sh45,000 for audit services.
Determine:
(i) A value added tax (VAT) account for the month of December 2009.
(ii) Comment on the penalties due where the VAT is not paid by Mambo Stores Ltd. on the due date(s).
Date posted: February 15, 2019. Answers (1)
- Outline four categories of goods which could be forfeited to the customs authority of your country upon their importation.(Solved)
Outline four categories of goods which could be forfeited to the customs authority of your country upon their importation.
Date posted: February 15, 2019. Answers (1)
- OjwangMatata is the owner of Mapato Supermarkets. He does not actively engage in the management of the supermarket.
He was therefore surprised recently when a team...(Solved)
OjwangMatata is the owner of Mapato Supermarkets. He does not actively engage in the management of the supermarket.
He was therefore surprised recently when a team of officers from the revenue authority visited him while conducting an investigation relating to tax compliance by Mapato Supermarkets. In particular, the officers were concerned that the supermarket was under-remitting value added tax (VAT).
OjwangMatata strongly feels that the revenue authority officers should have confined their investigations to the managers and staff of the supermarket, He is further concerned that the revenue authority has allowed some of the competing businesses to deregister for VAT purposes.
Advise OjwangMatata on the following:
(i) Powers of the Commissioner General to conduct tax investigations and any restrictions thereto.
(ii) Extent of his liability (if any) for VAT unpaid by Mapato Supermarkets.
(iii) Four circumstances under which a person or business could apply for deregistration from VAT regulations.
Date posted: February 15, 2019. Answers (1)
- Section 185(1) of the East Africa Customs Management Act (2004) provides that "Goods that are re-imported shall be entitled to re-entry free of import duties...(Solved)
Section 185(1) of the East Africa Customs Management Act (2004) provides that "Goods that are re-imported shall be entitled to re-entry free of import duties and to a refund of duties paid on exportation
Outline three conditions to be fulfilled before the refund of duties can be provided under the East Africa Customs Management Act (2004).
Date posted: February 15, 2019. Answers (1)
- The following transactions relate to Jakayo Traders for the month of December 2010:
Determine:
(i) VAT payable by (or refundable to) Jakayo Traders for the month of...(Solved)
The following transactions relate to Jakayo Traders for the month of December 2010:
Determine:
(i) VAT payable by (or refundable to) Jakayo Traders for the month of December 2010.
(ii) Comment on any information not used in your computation under (i) above.
Date posted: February 15, 2019. Answers (1)
- Discuss three challenges associated with the harmonization of taxation policies across regions and trading blocks(Solved)
Discuss three challenges associated with the harmonization of taxation policies across regions and trading blocks
Date posted: February 15, 2019. Answers (1)
- Were and Otieno are in partnership trading as Woti Enterprises. They share profits and losses in the ratio of 2:3 respectively. The partnership's statement of...(Solved)
Were and Otieno are in partnership trading as Woti Enterprises. They share profits and losses in the ratio of 2:3 respectively. The partnership's statement of comprehensive income for the year ended 31 December 2010 is as shown below
Prepare:
(i) A statement of adjusted taxable profit or loss for the partnership business for the year ended 31 December 2010
(ii) A schedule showing total taxable income for each partner for the year ended 31 December 2010
Date posted: February 15, 2019. Answers (1)