Question 1c
John and Rhonda Beach are a married couple. The following information is available for the tax year 2012–13:
John Beach
(1) John is aged 59 and is employed by Surf plc as a sales director. During the tax year 2012–13, he was paid gross director’s remuneration of £184,000.
(2) During the tax year 2012–13, John contributed £28,000 into Surf plc’s HM Revenue and Customs’ registered occupational pension scheme. The company contributed a further £12,000 on his behalf. Both John and Surf plc have made exactly the same contributions for the previous five tax years.
(3) During the period 6 April to 31 October 2012, John used his private motor car for both private and business journeys. He was reimbursed by Surf plc at the rate of 60p per mile for the following mileage:
| Miles | |
|---|---|
| Normal daily travel between home and Surf plc’s offices | 1,180 |
| Travel between Surf plc’s offices and the premises of Surf plc’s clients | 4,270 |
| Travel between home and the premises of Surf plc’s clients (none of the clients’ premises were located near the offices of Surf plc) | 510 |
| Total mileage reimbursed by Surf plc | 5,960 |
(4) During the period from 1 November 2012 to 5 April 2013, Surf plc provided John with a petrol powered motor car which has a list price of £28,200 and an official CO2 emission rate of 206 grams per kilometre. Surf plc also provided John with fuel for both his business and private journeys.
(5) During 2009 Surf plc provided John with a loan which was used to purchase a yacht. The amount of loan outstanding at 6 April 2012 was £84,000. John repaid £12,000 of the loan on 31 July 2012, and then repaid a further £12,000 on 31 December 2012. He paid loan interest of £1,270 to Surf plc during the tax year 2012–13. The taxable benefit in respect of this loan is calculated using the average method.
(6) During the tax year 2012–13, John made personal pension contributions up to the maximum amount of available annual allowances, including any unused amounts brought forward from previous years. These contributions were in addition to the contributions he made to Surf plc’s occupational pension scheme (see note (2)). John has not made any personal pension contributions in previous tax years.
(7) John owns a holiday cottage which is let out as a furnished holiday letting, although the letting does not qualify as a trade under the furnished holiday letting rules. The property business profit for the year ended 5 April 2013 was £6,730.
Rhonda Beach
(1) Rhonda is aged 66 and during the tax year 2012–13 she received pensions of £8,040.
(2) In addition to her pension income, Rhonda received gross building society interest of £21,400 during the tax year 2012–13.
Required:
(c) Calculate Rhonda Beach’s income tax liability for the tax year 2012–13. (4 marks)