Reference no: EM133258361

Yvonne Green is a public communications specialist. Yvonne has a contract to provide consulting services to the Ministry of Works ('MOW'). For the income year ending 31 March 2019, MOW pays Yvonne fees of $120,000. Yvonne incurs costs of $27,500 in connection with the provision of the consulting services.

Yvonne owns a rental property that she inherited from her grandmother in 1998. Yvonne receives rental income of $16,000 and incurs costs of $4,000. She sells the house in November 2018 and receives $650,000, which she reinvests in United Kingdom and New Zealand shares.

For the income year, Yvonne pays $36,000 in provisional tax. The table below sets out her net receipts:

1. Calculate Yvonne's income tax liability for the income year ended 31 March 2019 and the amount of her terminal tax or tax refund for this income year. (Use the tax rate scale in the table below, show full workings in your answer, and note any assumptions you have made. Provide your answers in whole dollars.)

2. Using the standard method, calculate Yvonne's provisional tax liability for the 2019- 2020 income year.

3. Assume that Yvonne is an employee of MOW and not an independent contractor. Recalculate your answer to (b).