What is the tax treatment for expenses incurred?

Assignment Question(s):                       (15.0 Marks) Each Questions Carries 1.5 Marks)

  1. A resident capital company has a tax base of SAR 1,000,000 and Saudi shares in its ownership is 30%.

Required: What is the tax due?

 

2.Taxpayer has a piece of land recorded at balance sheet a cost of SAR 100,000 and during the tax year, he incurred expenses of SAR 20,000 to improve the land.

Required: What is the tax treatment for expenses incurred?

Answer:

3.Taxpayer has an equipment with a book value of SAR 100,000 and during the tax year, he incurred expenses of SAR 20,000 to improve the land.

Required: What is the tax treatment for expenses incurred?

Answer:

4.Taxpayer purchased an equipment of SAR 100,000 to be used in the research and development activities.

Required: What is the deductible expenses?

Answer:

5.Bank ALBELAD recorded the following  journal entry in 2021:

Dr.  Bad debt expenses SAR 5,000,000

Cr.   Allowance for doubtful accounts 5,000,000

Required: What is the tax treatment for those provisions?

Answ

6.Taxpayer working as a manufacturing company recorded  the following  journal entry in 2021:

Dr.  Bad debt expenses SAR 100,000

Cr.   Allowance for doubtful accounts   100,000

Required: What is the tax treatment for those provisions?

Answer:

7.Non-resident person received income from Saudi company against services provided in the kingdom.

Required: Is non- resident person subject to income tax?  If yes what is the name of the tax and its tax rate.

Answer:

8.When Saudi persons are subject to income tax According to the income tax law in the kingdom?

Answer:

9.Taxpayer disposed of a non-depreciable asset with a cost base of SAR 100,000 by gift.

Required: What is the tax treatment for the assets disposed of?

Answer:

10.Taxpayer has written off accounts receivable with book value of SAR 50,000 not previously taxable.

Required: Is this bad debt deductible expense?

Answer: