KIRA AND LORNA KETTLEWELL – QUESTION

(a) Kira Kettlewell is a senior manager working for a large UK resident trading company.
She has an annual salary of £48,000 and has a company car, provided for the whole year
which gives rise to an assessable benefit of £5,040.
She pays £140 per year to the Institute of Management (which her employers insist
upon).
During the year ended 5 April 2010 she also received the following income:
£
Dividends 3,600
Bank deposit interest 280
Child benefit 1,451
Rental income for letting a furnished property 5,500
All the above amounts represent the actual cash figure received.

Expenses relating to the rental income were:

£
Council tax 850
Water rates 200
Agents’ fees 700
New entrance porch 3,100
Boiler repairs 250
She has also spent £400 on new furniture.
A property income loss of £590 was made in the year 2008/09.
Kira paid £400 to a national charity in November 2009 under the Gift Aid scheme.
Required:
Calculate the income tax payable by Kira Kettlewell for 2009/10. (15 marks)

(b) Kira’s mother, Lorna Kettlewell, is 67 years old. Her income consists of the following:
£
State pension 6,950
Pension from former employer (no tax deducted) 3,000
Building society interest 2,000
Dividends 1,710
The pensions are the gross amounts but the interest and dividends are the amounts
received.
Required:
Calculate the income tax payable/repayable for Lorna Kettlewell for 2009/10.
(5 marks)