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Kwaku Boafo has been in employment since 1999 on a consolidated salary of GHC3,600 per annum with Daakye Timbers Limited. In the year 2010, his consolidated salary was GHC15,000 from which he contributed 5% to the Social Security and National Insurance Trust. In the same year he remitted an amount of GHC1,800 (in cedi terms of his UK Pounds Sterling) being his net share of partnership profits in UK, into Ghana, after tax of GHC450 had been deducted in the UK. Kwaku Boafo is married with three children two of whom are in Christ the King Junior High School in Accra and one in Konongo Odumasi Senior High School (Great KOSS). You are required to: (a) Determine the Tax Credit Relief to be granted to Kwaku Boafo, on the basis that a double taxation agreement exists between Ghana and the United Kingdom (UK) and that Kwaku Boafo has provided evidence of payment of foreign tax on the amount remitted. (14% marks) (b) What is Kwaku Boafo's net tax liability in Ghana? (8 marks) 2010 TAX RATES GHC RATES % First 1,008.00 NIL Next 240.00 5 Next 720.00 10 Next 14,232.00 17.5 Exceeding 16,200.00 25 2010 PERSONAL RELIEFS Marriage / Responsibility GHC35.00 Disability Relief 25% Old Age Relief GHC35.00 Child Education Relief GHC30.00 per child Aged Dependent Relative GHC25.00 Cost of Training Relief GHC100.00 5:32 PM Kwaku Boafo has been in employment since 1999 on a consolidated salary of GHC3,600 per annum with Daakye Timbers Limited. In the year 2010, his consolidated salary was GHC15,000 from which he contributed 5% to the Social Security and National Insurance Trust. In the same year he remitted an amount of GHC1,800 (in cedi terms of his UK Pounds Sterling) being his net share of partnership profits in UK, into Ghana, after tax of GHC450 had been deducted in the UK. Kwaku Boafo is married with three children two of whom are in Christ the King Junior High School in Accra and one in Konongo Odumasi Senior High School (Great KOSS). You are required to: (a) Determine the Tax Credit Relief to be granted to Kwaku Boafo, on the basis that a double taxation agreement exists between Ghana and the United Kingdom (UK) and that Kwaku Boafo has provided evidence of payment of foreign tax on the amount remitted. (14% marks) (b) What is Kwaku Boafo's net tax liability in Ghana? (8 marks) 2010 TAX RATES GHC RATES % First 1,008.00 NIL Next 240.00 5 Next 720.00 10 Next 14,232.00 17.5 Exceeding 16,200.00 25 2010 PERSONAL RELIEFS Marriage / Responsibility GHC35.00 Disability Relief 25% Old Age Relief GHC35.00 Child Education Relief GHC30.00 per child Aged Dependent Relative GHC25.00 Cost of Training Relief GHC100.00 5:32 PM

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