Case (6)Case (6): :

Dr. Yahia works in his own private clinic and you Dr. Yahia works in his own private clinic and you have the following information on 31-12-2007have the following information on 31-12-2007 The total gross income = 13,0000 NISThe total gross income = 13,0000 NISAnd paid the following expensesAnd paid the following expenses::

--Electricity bills 1800 NIS annuallyElectricity bills 1800 NIS annually..--Water bills 600 NIS annuallyWater bills 600 NIS annually..

--Phone bills 2160 NIS annuallyPhone bills 2160 NIS annually..--In January 2007 bought clinic equipment (CT) In January 2007 bought clinic equipment (CT)

amounted 5000$ and the depreciation rate is amounted 5000$ and the depreciation rate is 7% annually7% annually..

--Huda works as a nurse with monthly salary 900 Huda works as a nurse with monthly salary 900 NISNIS

--Akram works as an office assistant with monthly Akram works as an office assistant with monthly salary 600 NISsalary 600 NIS

Dr. Yahia married with Dr. Sozan and she work in the Dr. Yahia married with Dr. Sozan and she work in the ministry of healthministry of health..They have three sons, Ahmed student in the 6th class and They have three sons, Ahmed student in the 6th class and Amjad student in Palestine university with certificate Amjad student in Palestine university with certificate document, and Rana married and lives with here document, and Rana married and lives with here husbandhusband..Dr. Yahia live with his father and he has pension from Dr. Yahia live with his father and he has pension from Palestinian AuthorityPalestinian Authority..They live in a rent house 200$ monthly paid by Dr. YahiaThey live in a rent house 200$ monthly paid by Dr. Yahia

If you know that Dr. Yahia has no income except 200$ If you know that Dr. Yahia has no income except 200$ monthly salary from (UN) paid for his medical monthly salary from (UN) paid for his medical consultingconsulting..Required: calculate the followingRequired: calculate the following::

11 - -total gross incometotal gross income..22 - -taxable incometaxable income..

33 - -The deductions and exemptionsThe deductions and exemptions..44 - -the accrued value of tax annually and monthlythe accrued value of tax annually and monthly..

The exchange rate for dollar 4.5 NISThe exchange rate for dollar 4.5 NIS..

11 - -The total gross income from all recourses = 130000/4.5= The total gross income from all recourses = 130000/4.5= 28888.8$28888.8$

200$200$ * *1212 = = 2400$2400$

Total income = 31288.8Total income = 31288.8

Gross taxable income = 28888.8Gross taxable income = 28888.8

DeductionsDeductions

Electricity 1800/ 4.5 = 400$Electricity 1800/ 4.5 = 400$

Water 600/ 4.5 = 133$Water 600/ 4.5 = 133$

Phone 2160/ 4.5 = 480$Phone 2160/ 4.5 = 480$

Depreciation of CT 5000$* 7% =350$Depreciation of CT 5000$* 7% =350$

Huda salary = 900*12/ 4.5 = 2400$Huda salary = 900*12/ 4.5 = 2400$

Akram salary = 600*12/ 4.5 1600$Akram salary = 600*12/ 4.5 1600$

total of deductions = 5363$total of deductions = 5363$..

ExemptionsExemptions::

Resident 3000$Resident 3000$

Wife 0$Wife 0$

Sons 500$Sons 500$

University student 2500$University student 2500$

Married daughter 0$Married daughter 0$

Rent of house 2000$ (200*12=2400) max 2000$Rent of house 2000$ (200*12=2400) max 2000$

Total of exemption 8000$Total of exemption 8000$

Total of deductions and exemptions = 5363+8000 =13363$Total of deductions and exemptions = 5363+8000 =13363$

Net taxable income =28888.8 – 13363 = 15525.8$Net taxable income =28888.8 – 13363 = 15525.8$

Annual income tax = (10000*8% + 5525.8*12%)Annual income tax = (10000*8% + 5525.8*12%)

800800 + + 663663 = = 1463$1463$

Monthly income tax = 1463/12 = 121.9$Monthly income tax = 1463/12 = 121.9$

121.9121.9* * 4.54.5 = = 548.6548.6 NISNIS

Case (7)Case (7): :

Mrs. Eman is a relict woman, she works in Mrs. Eman is a relict woman, she works in private company with monthly salary private company with monthly salary 1850 NIS, She has three sons and lives in 1850 NIS, She has three sons and lives in a rent house 8500 NIS annuallya rent house 8500 NIS annually

Required: calculate the income tax to be Required: calculate the income tax to be paid (the exchange rate 5 NIS)paid (the exchange rate 5 NIS)

Note : in this case we have family woman, Note : in this case we have family woman, and she will have all the exemption have and she will have all the exemption have been given to the family manbeen given to the family man..

Annual income 1850*12/5 = 4440$Annual income 1850*12/5 = 4440$..Deduct the exemptionDeduct the exemption Resident 3000$Resident 3000$Husband (dead) 0$Husband (dead) 0$Sons 1500$ (3*500)Sons 1500$ (3*500)

Rent 1700$Rent 1700$ Total 6200$Total 6200$So tax is 0$ because the exemption are So tax is 0$ because the exemption are more than the incomemore than the income..

AnswerAnswer::

partnershippartnershipCase (8)Case (8)::

A taxpayer is partner in A taxpayer is partner in corporation own 50% of corporation own 50% of capital and has monthly salary capital and has monthly salary 2500 NIS for managing, he is 2500 NIS for managing, he is married and has three sons married and has three sons one of them study in the one of them study in the university with and others in university with and others in schoolschool..The taxpayer lives with his The taxpayer lives with his father and mother and take father and mother and take care of them, he lives in a rent care of them, he lives in a rent house 500 NIS monthlyhouse 500 NIS monthly..The partnership result for the The partnership result for the corporation as follow: revenue corporation as follow: revenue and expensesand expensesDollar = 4 NISDollar = 4 NIS

RequiredRequired : : Calculate the income taxCalculate the income tax..

DrDr CrCr

PurchasePurchase 250000250000 SalesSales 525,000525,000

Begging Begging inventoryinventory

125000125000 Ending Ending inventoryinventory

6000060000

Sales Sales expensesexpenses

1750017500

AdministrativAdministrative expensese expenses

75007500

Salary for Salary for partners partners

50%50%

6000060000

RentRent 75007500

SalesSales 525,000525,000

Cost of goods soldCost of goods sold 315,000315,000

PurchasesPurchases 250,000250,000

Begging inventoryBegging inventory 125,000125,000

Ending inventoryEnding inventory 60,00060,000

Gross incomeGross income 210,000210,000

DeductionsDeductions 92,50092,500

Administrative expenseAdministrative expense 75007500

Sales expenseSales expense 17,50017,500

RentRent 75007500

Salary for two partnersSalary for two partners 60,00060,000

Net revenueNet revenue 117,500117,500

Total revenue for partnerTotal revenue for partner 117,500117,500**50%50% = = 58,75058,750

Total income for taxpayerTotal income for taxpayer 58,75058,750 + +3000030000 salary (2500*12)= salary (2500*12)= 88,75088,750

Annual incomeAnnual income 88,750/488,750/4 = =22,187.50$22,187.50$

ExemptionsExemptions 9500$9500$ResidentResident 3000$3000$

WifeWife 500$500$

Son *2Son *2 1000$1000$

University studentUniversity student 2500$2500$

Father and motherFather and mother 1000$1000$

Rent house 500*12/4Rent house 500*12/4 1500$1500$

Taxable incomeTaxable income 12,687.5012,687.50

10,00010,000**8%8%= = 800$800$

2687.502687.50 * * 12%12% = = 322.50322.50

Paid income taxPaid income tax 1122.501122.50

Assume the given information for Assume the given information for sharing company ( Cooperation )sharing company ( Cooperation )!!

What is the main differenceWhat is the main difference??

The same situation without The same situation without exemptionsexemptions

Total revenue 117,500/4 = 29,375$Total revenue 117,500/4 = 29,375$..

income taxincome tax::

29,37529,375* * 15%15%= = 4406.254406.25