Mr. Banu Shah provided the following information for the year ended 31
o He was employed as a full time director of Letex Limited at a salary of
Sh.80,000 per month (PAYE Sh.31,200 per month was deducted).
o Free goods worth Sh.30,000 were received from the company in the year for
o He enjoyed free medical treatment under a medical scheme operated by the
company which was assessed at Sh.50,000 in the year.
o Mr. B Shah and his wife operate a company fully owned by them whose
taxable income has been agreed at Sh.200,000 after charging wife’s salary of
Sh.120,000 (PAYE sh.22,000).
o Letex Limited provided him with free housing from 1 August 2005 prior to
which he lived in his own house.
His wife also works as a nurse in a private hospital and earned Sh.20,000 per
month (PAYE Sh.4,000).
Rent from property owned was Sh.30,000 per month from August 2005.
Repair and painting of Sh.11,500 before letting. The house had a mortgage of
Sh.2,000,000 and Sh.600,000 was paid of which Sh.330,000 was capital
(i) Total taxable income of Mr. Banu Shah for 2005. ( 9 marks)
(ii) Tax payable/repayable on the income computed above. ( 3 marks)
(ii) Comment on the importance of P9 A in Income Tax Returns. ( 2 marks)