ACCT90016: Taxation for Business Decision Making
Week commencing: 12 Sep 2016
Sem 2, 2016
[19.16] Study questions CGT
7. Over the last 12 months, Eric acquired the following assets: an antique vase (for
$2,000), an antique chair (for $3,000), a painting (
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ACCT90016: Taxation for Business Decision Making
Week 3 commencing: 08 Aug 2016
Sem 2, 2016
Part B: Residence & Source
[9.6] Study questions
1. Why is the concept of residence and source important?
2. What are the general jurisdictional r u l e s ? Discus
ACCT90016: Taxation for Business Decision Making
Week commencing: 19 Sep 2016
Sem 2, 2016
[13.12] Study questions General Deductions
5. Amalgamated Zinc (De Bavays) Ltd v FC of T (1935) 54 CLR 29 is authority for the proposition
that an outgoing incurred
ACCT90016: Taxation for Business Decision Making
Week commencing: 29 Aug 2016
Sem 2, 2016
[20.24] Study questions FBT
6. George is employed as a journalist. His employer pays him an allowance of $50
per week to cover the costs of any newspapers and magazi
ACCT90016: Taxation for Business Decision Making
Week commencing: 29 Aug 2016
Sem 2, 2016
[20.24] Study questions FBT
6. George is employed as a journalist. His employer pays him an allowance of $50
per week to cover the costs of any newspapers and magazi
ACCT90016: Taxation for Business Decision Making
Week 4 commencing: 15 Aug 2016
Sem 2, 2016
[16.4] Study questions Tax Timing (Derivation)
3. John is a self-employed accountant. He owes his plumber $5,000 for work done on Johns
bathroom. John requests one
ACCT90016: Taxation for Business Decision Making
Week commencing: 05 Sep 2016
Sem 2, 2016
[10.9] Study questions Ordinary Income (from Business)
4. Are all receipts of a taxpayer that carries on a business income in nature?
5. Explain the respective outco
TaxDeductionNotesPart2
NOT deductible if: they are considered to be private, AND lacking the
relevant connection to the taxpayers actual income producing activities (FCT
v Lodge)
1) in relation to the gaining of exempt or non-assessable non-exempt
income
Part E: Disposal of a capital asset
Key features
v On 20 September 1985, Capital Gain Tax was introduced.
Generally does not apply to assets acquired before 20 Sep 1985.
v Part 3-1 (ss. 100-1 to 121-35) of ITA
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Cover sheet for: TR 2015/2
Generated on: 12 September 2015, 02:30:48 PM
This cover sheet is provided for information only. It does not form part of the underlying document.
This Ruling, which applies from 1 July 2015, replaces TR 2014/4 (see paragraph 5 o
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CGT EXAMPLES
(Semester 2 2015)
Example 1: Sale of an asset
Joan acquired an asset on 20 September 1987 for $20,000. She sold the
asset on 20 March 1999 for $60,000.
Indexed cost base :
Cost base x indexation factor
= $20,000 x 67.8
46.8
=$28,980
CGT gain
CGT EXAMPLES
(Semester 2 2015)
Example 1: Sale of an asset
Joan acquired an asset on 20 September 1987 for $20,000. She sold
the asset on 20 March 1999 for $60,000.
Indexed cost base:
Cost base x indexation factor
= $20,000 x 67.8
46.8
=$28,980
Index no.
CALCULATING TAXABLE VALUE/FBT
PAYABLE
(2014/2015 FBT year)
<Some examples>
CAR FRINGE BENEFIT
(a) TAXABLE VALUE using STATUTORY FORMULA
METHOD
Assume : (commitment to provide the car as a benefit
occurred on 1 April 2014)
1. Base value of car: $20,000
2.
CALCULATING TAXABLE VALUE/FBT PAYABLE
(2014/2015 FBT year)
<Some examples>
CAR FRINGE BENEFIT
(a)
TAXABLE VALUE using STATUTORY FORMULA
METHOD
Assume : (commitment to provide the car as a benefit
occurred on 1 April 2014)
1. Base value of car:
$20,000
2.
NotesonCGTPart2
Disposal of a CGT asset
CGT event A1: s 104-10 ITAA 1997
Time of disposal: when the contract is entered into or when the
change of ownership occurred: s 104-10(3)
Calculating CGT gain on disposal of an asset
5 elements of Cost Base:
a) Acq
Income Notes Part 3
Loan FB (s 16(1)
Arises where an employer makes a loan to an employee and
charges interest less than the interest calculated using a statutory
benchmark rate [ for the year ending 31 Mar 2014, 6.45%, 31
Mar 2015, 5.95%]
a) Taxable valu
Income Notes Part 4
Income from business
Income arising from the normal activities of a business is
assessable according to ordinary concepts and is therefore
ordinary income brought to account under s. 6-5 (1) ITAA 1997
Identifying a business: pp. 76
FCT
Notes Part 2
Two areas of statutory intervention
S 15-2 ITAA 1997
The value to the taxpayer of any FB is assessable to the
taxpayer
S. 15-2 is limited to cash allowances, bonuses, etc. (things in
forms of cash) paid in relation, directly or indirectly to
FEDERAL COMMISSIONER OF TAXATION - Appellant;
AND
FRENCH - Respondent,
Income TaxAssessmentExempt incomeEngineerResident of StateCon
tractEmployed by company in StateServices rendered to company during three
weeks in New ZealandPayment therefor according
Notes on CGT Part 1
Whichtaxapplies
Forassetsacquiredonorafter20Sep1985,CGTapplies
Forassetsacquiredbefore20Sep1985,theoldlawmaystillapply
Theoldlaw:
Priorto20Sep1985,capitalreceiptsweretaxfreeunlessthegainwas
madefromeither:
a) Thesaleofpropertyacquiredf
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Outcome of cases and would Myer Emporium limb apply? (CGT & Income from bus)
Critical Fact
Scottish Aust
Mining
(Pre-Myer*)
Coal Mining
Whitford
Beach
(Pre-Myer*)
Business of
Orginal owners:
the taxpayer
to access the
beach for
private
purp
FBT:
Basic information:
Fringe Benefits Tax Assessment Act
1986
1) FBT tax year is 1 April 31 March.
2) FBT rate for 2015/16 and 2016/17 is a flat 49%. It will reduce to
47%
in 2017/18 (as it was in 2014/15).
3) FBT is paid by the employer, not the employ
Residency:
Test for individuals:
INCOME TAX ASSESSMENT ACT 1936 -
SECT 6
1. Primary law test
- Dwells permanently or for a considerable time; OR
- Has their settled or usual place of abode.
0
0
Factors to consider:
a) Physical presence of the person in Au
Derivation:
why is it important?
INCOME TAX ASSESSMENT ACT 1997 -
SECT 6-5
1) S.6-5(2)/6-5(3) ITAA 1997 bring to account income derived by
the taxpayer
- Australian resident: assessable income includes the ordinary
income you
derived directly or indirect
Source:
Question of fact:
Nathan v FCT
.the ascertainment of the actual source of a given income is a
practical, hard matter of fact.
Basic principles
(1) Where income is derived solely from the acts of the taxpayer:
(2) Where income arises from the posse
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