Posted: January 17th, 2023

LAWS20060 QUESTION 1 a) What topic does Taxation Ruling TR 2019/1 cover

LAWS20060 – TAXATION LAW OF AUSTRALIA
INDIVIDUAL ASSIGNMENT
TERM 2 2019
Due date: Week 7 – Wednesday 4th September 2019
Weighting: 40% – 80 marks in total available
Length: 2500 – 3000 words
Submission: Online via Moodle
Format: One file in .doc or .docx (MS Word) format
Objectives
This assessment item relates to learning outcomes 1, 2 and 3 as stated in the course
profile.
Details
This assignment is to be submitted in English in one (1) Word document only. This
assignment is to be submitted online via Moodle by the due date stated. It is
suggested that where necessary you put your calculations into columns or tables to
improve readability in the assignment document
The method of referencing to be used in this assignment is the Australian Guide to
Legal Citation (AGLC) 4rd Edition referencing method. Additional information
regarding this method is available through the library and the Academic Learning
Centre. When making a reference, cite the original source or authority in preference
to a secondary source such as the textbook, especially when you are discussing
various sections of legislation. This means you should make references to legislation,
cases and Tax Rulings as a priority to back up any arguments that you make in your
assignment.
Extensions policy
The university policy on extensions of time will be strictly enforced. Extensions will
only be considered if made via the online system and based on medical or
compassionate grounds. Any extension application should be made before the due
date for submission. Medical conditions should be supported by a medical
certificate, and, since students are expected to start the assignment early,
temporary or last-minute conditions are usually not grounds for an extension.
Professionals are expected to manage their time to meet their obligations, so work
or personal commitments are insufficient grounds for an extension.
Plagiarism
The university’s plagiarism policy will also be strictly enforced. If plagiarism is found,
a minimum penalty is likely to be zero marks for the assignment. This assignment is
the only assignment for this course, and it carries a weighting of 40% of the total
assessment for the course.
While the assignment is largely based on material covered, you are free to research
and seek advice as widely as you find necessary – there are no limitations as to
sources. However, you must make sure that sources are appropriately referenced.
Students must complete all questions in the assignment.
With reference to all questions – support the analysis in your answers where
appropriate to the ITAA97, ITAA36, Tax Rulings and/or case law.
QUESTION 1
a) What topic does Taxation Ruling TR 2019/1 cover? 1 mark
b) Which Division of the Income Tax Assessment Act 1997 outlines the
legislation regarding deductibility of gifts or contributions? 1 mark
c) What is the top tax rate applicable to a resident taxpayer in the current tax
year? 1 mark
d) Is a car or motorcycle exempt from capital gains tax? 1 mark
e) What does the CGT event C1 s104-20 tax? 1 mark
f) What is the current tax-free threshold for a resident individual? 1 mark
g) Write my Essay Online Writing Service with Professional Essay Writers – Explain the significance of the High Court case, Hayes v FCT (1956) 96 CLR 47
with reference to assessable income? 4 marks
h) Write my Essay Online Writing Service with Professional Essay Writers – Explain in your own words the difference between Ordinary income and
Statutory income? 5 marks
i) Write my Essay Online Writing Service with Professional Essay Writers – Explain the difference between Medicare levy and Medicare levy surcharge?
5 marks
Total 20 marks
QUESTION 2
Section 6(1) of the 1936 Act defines Australian resident as it relates to individuals as
follows: ‘”resident” or “resident of Australia” means –
(a) a person … who resides in Australia and includes a person –
i. whose domicile is in Australia, unless the Commissioner is satisfied that his
permanent place of abode is outside Australia;
ii. who has actually been in Australia, continuously or intermittently, during
more than one-half of the year of income, unless the Commissioner is
satisfied that his usual place of abode is outside Australia and that he does
not intend to take up residence in Australia; or
iii. who is [a member, spouse or child under 18 of a member of certain
Commonwealth public service superannuation funds]’ (underlining added).
REQUIRED:
Homework help – Discuss the difference between ‘permanent place of abode’ and ‘usual place of
abode’ with reference to the residency requirements stated in s6(1) ITAA36 and
reproduced above. Ensure your answer includes a discussion of the context in which
it is referred. Total 15 marks
QUESTION 3
Briefly explain the extent, if any, to which each of the following payments made by a
trainee accountant, during the current tax year would be an allowable deduction:
a) HECS-HELP $850
b) Travel – work to university $110
c) Books $200
d) Childcare during her evening classes $80
e) Repair to her fridge at home $250
f) Black trousers and shirt required to be
worn at the office $145
g) Legal expenses incurred in writing up a new employment contract with a new
employer. $300
State any assumptions you have made and provide legislative reference to support
your explanation. Total 10 marks
QUESTION 4
a) John owns some land and grants a lease to David for seven years, at a premium
of $7,000. 3 marks
b) Deepak is an IT specialist and in his spare time tries to make some extra money
investing in shares but he is not so successful. On the 1 September 2018 he bought
10,000 shares in IOOF Pty Ltd for 55 cents and sold them on the 30 June 2019 for
67 cents per share. At the same time, Deepak also purchased 12,000 shares in
Greencross Pty Ltd for $1.67 and decided to also sell them on the 30th of June
2019 as he could see they were drastically falling in value. He sold his Greencross
Pty Ltd shares for $1.18 per share. Outline and calculate the net capital gain or
loss that Deepak would record in his 2018/19 tax return. 7 marks
c) Li bought a home in March 2010 for $200,000. In March 2013, she converts the
separate garage into an office for her physiotherapy business. The garage
comprises 20% of the floor space of the dwelling on the property. She sells the
property in March 2019 for $700,000. Its market value at the time of first using
the converted garage for income producing purposes was $400,000. What are
the CGT implications for Li of converting her garage on the sale of her home?
5 marks
d) Write my Essay Online Writing Service with Professional Essay Writers – Explain in your own words the difference between cost base and reduced cost
base. 5 marks
Outline the CGT consequences in each of the above situations for the 2018/19 tax year
and state if the 50% discount would be applicable to any of the above transactions?
Total 20 marks
QUESTION 5
a) Is income earned from illegal means (e.g. drug-dealing, insider trading or theft)
assessable income? 3 marks
b) Calculate the assessable income of a resident taxpayer in the current year if
they were to be in receipt of $500 bank interest from their savings account,
$10,000 won at the Crown Casino, $2,000 rent earned from a boarder sharing
a house. Give reasons, considerations and quote reference to sections of the
ITAA in your answer. 3 marks
c) Would a $500 allowance paid to an employee by an employer be assessable
income to the employee. Write my Essay Online Writing Service with Professional Essay Writers – Explain your answer. 3 marks
d) Calculate the Medicare payable for a resident individual with a taxable income
of $20,000, $24,900 and $100,000 3 marks
e) Calculate the gross tax payable for the taxable income of $25,000, $40,000 and
$95,000. (Note Gross tax payable is the amount of tax due before Medicare
levy and tax offsets) 3 marks
REQUIRED:
Answer each question above giving consideration to the allocated marked.
Total 15 marks
Assessment criteria Evaluation Research Topics – Criteria
These criteria are a general guide as to the standard expected at the various levels.
Characteristics indicative of the respective levels of achievement in the assignment are as
follows. It is not necessarily the case that all these criteria will be met at a particular
standard as there may be a superior performance on one of the criteria and not so
satisfactory performance on another.
High distinction standard
• The answer is very well written and clearly expressed
• There is a demonstrated appreciation and understanding of the issues involved
• The answer is well structured and logically organised
• Demonstrated mastery of referencing system
• There is evidence of a comprehensive analysis of the issues
• Conclusions are backed by well-reasoned arguments demonstrating a detailed
insight and analysis of issues
• Comprehensive coverage of all relevant issues
• References are made to the appropriated legislation for particular issues
• Statutory provisions are analysed and interpreted correctly
• The legislation is applied to the particular fact situation in a competent manner
• Consideration is given to the operation of the common law
• There may be consideration of issues not raised in the tutorials and answer guides
Distinction standard
• The answer is well written and expressed
• The answer is structured and logical
• The issues have been reasonably well identified and appreciated
• There is correct use of referencing
• Issues have been analysed
• Reference is made to all appropriate legislation, although the analysis and
interpretation is not as detailed and reasoned as for the high distinction standard
• The effect of the common law is considered
• There is a comprehensive coverage of the issues
• Occasional errors of law and legal reasoning may still be present
Credit standard
• The answer is generally well written and expressed
• The answer is structured and sequential
• Referencing is satisfactory
• Issues are identified and addressed
• There has been an attempt to analyse some of the issues
• The coverage of issues is reasonably comprehensive often with a good treatment
and analysis of particular points
• Errors of law and incorrect reasoning may sometimes be present
• Statutory interpretation may require improvement
• Depth of treatment is often lacking in some of the issues
Pass standard
• The answer is able to be followed and understood
• The answer could perhaps be better organised and structured
• The referencing may need improvement
• Issues may need to be identified and addressed in more depth
• Analysis when present may be incorrect
• Some familiarity with the legislation and its application is demonstrated
• Sometimes the conclusions reached are simple
• There may be several errors of law
• There may be quantities of material of marginal relevance included in the answer
Fail standard
• The answer may be significantly short of the required length
• The written expression is poor and difficult to understand
• The answer is poorly organised
• There has been a failure to identify and address the issues in the question
• Referencing is generally inadequate
• There is a lack of familiarity with the legislation and its appropriate application
• The reasoning and application demonstrated is poor
• Frequently there is much irrelevant material
MARKING
All parts of the assignment will be marked in accordance with the university’s Grades
procedure (which can be accessed via the Course Profile). The following marking rubric
incorporates that procedure.
MARKING RUBRIC GRADE MARK
GRADE – HD
MARK – 85%+
CRITERION Demonstrates proficiency in all the learning outcomes of the unit; work is well
read or scholarly.
COMMENT: Here, the student will have done everything well and formulated their answer in
a tight, efficient, thoroughly professional manner. Their explanations and arguments will
have a strong logical flow and be convincing. Their research will be thorough.
GRADE – D
MARK – 75-84%
CRITERION Demonstrates awareness and understanding of deeper and less obvious aspects
of the unit, such as ability to identify and debate critical issues or problems, ability to solve
non‐routine problems, ability to adapt and apply ideas to new situations. COMMENT: The
student will demonstrate this by achieving all the outcomes for a Credit, but also some of the
higher level standards for a High Distinction.
GRADE – C
MARK – 65-74%
CRITERION Demonstrates ability to use and apply fundamental concepts and skills of the
unit, going beyond mere replication of content knowledge or skill to show understanding of
key ideas, awareness of their relevance and some use of analytical skills.
COMMENT: Learning involves not only knowing principles or concepts but also the ability to
apply them to a real-life situation.
GRADE – P
MARK – 50-64%
CRITERION Demonstrates the learning outcomes of the unit, such as knowledge of
fundamental concepts and performance of basic skills; demonstrates sufficient quality of
performance to be considered satisfactory or adequate or competent or capable in relation
to the learning outcomes of the unit.
COMMENT: Students who get a mark in this range usually demonstrate some knowledge of
principles and concepts, but do not explain or apply them accurately. Answers often look like
little more than a summary of what someone else has written.
GRADE – F
MARK – 40-49%
CRITERION Fails to demonstrate the learning outcomes of the unit.
COMMENT: Students in this range usually make some effort to perform the assignment task
but fail to achieve what is prescribed for a Pass.
GRADE – Low F
MARK – <40%
CRITERION COMMENT: Students in this range usually fail to properly carry out the
instructions or fully perform the tasks specified in the assessment.

Sample Answer:

LAWS20060 – Term 2, 2017
Assessment 1 – Individual Assignment
Student Name:
Institutional Affiliation:
Date:

Question 1-Advice to Webjet frequent flyer
It would be of great essence for the Webjet frequent flyer to fully understand that in accordance to FBTAA (Fringe Benefits Tax Assessment Act) 1986, the benefits that are received by employees because of taking part within a frequent flyer program do not basically constitute fringe benefits. In addition, the benefits that a taxpayer receives, whether an employee or otherwise, because of taking part within a frequent flyer program may be considered to constitute assessable income within that taxpayer’s hands in respect to ITAA (Income Tax Assessment Act) 1936. Besides, the benefits that the employees receive may constitute assessable income in respect to ITAA paragraph 26(e) .
For purposes of establishing assessable income, the benefits that a taxpayer receives that have a monetary value, besides the non-cash business benefits that are covered under ITAA, Section 21A, have to be value within a fair market value as at the time during which the benefit is derive. Within majority of the cases, the ATO (Australian Taxation Office) considers as the fair market value to be the lowest cash price, which the taxpayer would typically have paid for the purchase of such a benefit from an arm’s length supplier. Either in the case whereby both employer-paid, as well as, private transactions have led to the employee’s entitlement to the benefit, the benefit value will have to be apportioned. For instance, within a frequent flyer program, the benefit value has to be reduced by an apportionment on the basis of the points the taxpayer paid as a result of private transactions divided the number of points needed to obtain the benefit.
Question 2 -Advice to crane hire company
Compensation received for loss of an asset mostly takes the receipt form in respect to the loss or destruction of the asset. Such asset disposal results in a CGT (Capital Gains Tax) event taking place in respect to that asset, whereby the compensation receipt is included within the consideration for such event. When establishing the taxable loss or fain realized, the regular CGT rules apply. This includes the 50% discount in cases whereby the asset had been possessed for more than a year, as well as, the CGT concessions for small business, where applicable.
In cases whereby the asset has been damaged permanently, such as within the case under review, the received compensation payment reduces the asset’s cost base. Compensation of this nature is treated as the recoupment of the costs that are incurred in replacing the asset and are not included within the asset’s cost base in respect to paragraph 110-45(3).
Question 3 -Advice to the nightclub manager
In the event one is moving overseas , for study, work or holiday, it is highly likely that for income tax purposes, one will be considered as an Australian non-resident in the course of his or her overseas stay. Therefore, it is essential to comprehend the manner in which one’s residency status is set to be determined, as well as, the non-residency tax implications. For the Australians travelling abroad, the IT 2650 (ATO Taxation ruling) stipulates the various factors that have to be put into consideration, which include: intended length of stay abroad; the continuity of presence within the foreign country; the intention of either returning to Australia or travelling to another nation among others. Nonetheless, an individual who leaves the country, with the plan of jetting back in not more than two years, such as in this manager’s cases, is normally treated as an Australian resident for tax purposes.
Question 4- Advice to canoe club
Some NFP (Not-For-Profit) clubs, societies, as well as, associations are treated as taxable organizations and hence are not exempted from income tax. Examples of such NFPs are such as social clubs, professional associations, political parties and many others. If a NFP organization falls under the taxable category, it may be compelled to file tax returns in addition to paying income tax. In the case under review, the canoe club can be considered to be a social club hence it can be treated as a taxable NFP. Nonetheless, in the event its taxable income happens to be not more that $416 per year, it will not have to file a tax return in the event an Australian resident (unless otherwise requested to do so) .
The others NFPs that fall under the taxable category and have an income of more than $416 per annum, are expected to file their returns. However, in the case of the ‘canoe club’ the refunds made to the members will not be taxable and will not be part of club’s yearly taxable income. All the aforementioned conclusions will not remain the same in the event it turns out that the canoe club is a NFP that is exempted from tax.
Question 5
The payment received by the Australian footballer for turning out as the best, as well as, the fairest within the AFL will be considered as part of the player’s assessable income. Basically, assessable income for players include all the income earned in salaries and wages, rental from property, endorsements in goods or cash, all competition winnings, capital gains upon sale of assets, interests accrued on savings and many other sources. Typically, the taxable income is obtained by deducting the allowable expenditure from the assessable income. Upon establishing the taxable income, the respective tax scales are applied for the purposes of determining the affected player’s tax liability. In some cases, the tax liability may be adjusted for the purposes of including any rebate that may be due .
An income rebate of as low as $445 is applicable in the cases whereby the taxable income is not more than $35,000. An extra 1.5% is added as the Medicare Levy. In the event the income is less than $20.452, no levy is payable. In the event the income is more than $80,000, and the player has no private cover, a 1% Medicare levy surcharge is applied. In case the taxable income is more than $130,000, the surcharge shoots to 1.5%.
Question VI
The expenses related to a building qualification that are incurred by the building apprentice can be considered to fall under the work-related self-education expenses. One claims such expenses in the event they happen to have a concrete connection to the present work activities. Self-education can involve attending a formal course or even a seminar. For the course to be considered as adequately connected to the present work activities, it should maintain or make better the various skills one needs within the present employment and contribute to an increase in income from the present employment. It is outright that the case of the apprentice fulfils al the aforementioned factors.
Nonetheless, upon fulfilling the aforementioned conditions, the apprentice should understand that generally one can claim study-related items of the likes of course fees, student union fees, textbooks, student union fees, among others. It is of great essence to keep records of the said self-education expenses. The aforementioned records can be written evidence or receipts of one’s expenses, inclusive of receipts for the depreciating assets that one has purchased such as laptops. One can also keep dairy entries for the expenses include on telephone, internet access, equipment for the self-education purposes over a one month period
Question VII
Putting into consideration that the client is to incur expenses while taking a short course that may result to advancement in his or her career, it can also be considered to fall under the work-related self-education expenses. In that regard, One can claim such expenses as they happen to have a concrete connection to the present work activities. Self-education can involve attending a formal course or even a seminar. For such a course can be considered as adequately connected to the present work activities, as it will definitely make better the various skills one needs within the present employment and contribute to an increase in income from the present employment. It is outright that the case of under review fulfils al the aforementioned factors .
Nonetheless, upon fulfilling the aforementioned conditions, the art management employee should understand that generally one can claim study-related items of the likes of course fees, student union fees, textbooks, student union fees, among others. It is of great essence to keep records of the said self-education expenses. The aforementioned records can be written evidence or receipts of one’s expenses, inclusive of receipts for the depreciating assets that one has purchased such as laptops. One can also keep dairy entries for the expenses including of expenses on telephone, internet access, equipment for the self-education purposes over a one month period for purposes of making use of the dairy as the written evidence.
Question VIII
One can launch a deduction claim for costs incurred in the purchase or even cleaning of occupation-specific clothing, unique, distinctive uniforms, as well as, protective clothing. To make the deduction, may have to produce written evidence, which indicates that the purchase was made, as well as, written evidence of the cleaning costs. In the event once received an allowance from the employer for uniforms or even dry-cleaning, one should make certain that the allowance amount is shown within the tax returns.
One can claim for uniform or work dresses, inclusive of or work makeup whether they are compulsory or simply non-compulsory, which are unique , as well as, distinctive to the organization. Clothing is considered as unique in the event is not only designed but also made simply for the employer. Clothing is distinctive in the event it has a permanent logo of the employers, and such clothing cannot be available within the general public. In that perceptive, one is not expected to claim the cost incurred in the purchase or laundry of a plain uniform.
Question IX
Concerning expenses related to travel from home to office and vice versa, they are in most cases considered as private travel. Nonetheless, one can claim deductions within certain circumstances, in addition to some travel from one workplace to another. In the event one travels both privately and partly for work, a claim can only be launched for the costs incurred while carrying out the employment duties.
Claims are allowed in the case whereby one incurs const while travelling directly between two distinct work stations, for instance, in the case whereby one has a second job. Claims are also permitted for travelling from the workstation to another workplace, for instance, the premises of a client, while still on duty or in the event one travels from home to another work station fore work purposes, and afterwards to one’s normal workplace or home directly. However, the just mentioned condition is not applicable in cases whereby the alternative workplace has turned out to be a regular workplace.
One is also entitled to a claim in the event he or she has to carry heavy tools or even equipment and the employer requires to be used in the work and they could not be left with the workplace, for instance, while carrying out job duties that require the use of an extension ladder. be Either way, one cannot claim for compensation for travelling in his or her car between the workplace and home due to the fact that one does work-related tasks, for instance picking up mail on the way to home or work .
Question X
As earlier mentioned, there are the specified scenarios whereby one can claim travel costs in respect to the ATO. Claims are allowed in the case whereby one incurs const while travelling directly between two distinct work stations, for instance, in the case whereby one has a second job. Claims are also permitted for travelling from the workstation to another workplace, for instance, the premises of a client, while still on duty or in the event one travels from home to another work station fore work purposes, and afterwards to one’s normal workplace or home directly. However, the just mentioned condition is not applicable in cases whereby the alternative workplace has turned out to be a regular workplace. In that regard, it is outright that one cannot claim the costs incurred in travelling from one employer to the other.
QUESTION 2
In Australia, the income tax rates basically depend on the year that the income was earned, as well as, the residency status of the earner. Putting into consideration that Manpreet’s is an international student who has come to CQU, Sydney for studies, she will actually be treated as a non-resident for taxation purposes. The non-residents are usually taxed more as compared to the residents and are not eligible for a tax-free threshold. Nonetheless, the part year residents are in some cases eligible for what is terms as the part-year tax-free threshold . In the event one is a foreign resident who works within Australia, one has to declare on his or her tax return all income earned within Australia, inclusive of rental income, employment income, capital gains on the acquired Australian assets, as well as, Australian pensions together with annuities, expect in the cases whereby exemption is available in accordance to the Australian tax law.
In addition, non-residents are not required to pay for the Medicare levy as they are not event entitled to the Medicare health benefits. Besides, they are not expected to declare the Australian-sourced dividends, interests or royalties that are derived while one is a foreign resident, as long as the Australian financial institution which pays the non resident has already withheld tax .
In respect to the aforementioned facts, in the Manpreet’s case, the only taxable income is the $45,000 earned while working as an office assistant. The other sources of income such as the $20,00 send by her parents, the $10,000 from an Indian trust account are not subject to tax as they were not earned within the Australian borders.
The tax rates for non-residents in the 206-17 financial year were as tabulated below
Taxable Income Tax on this income
0 – $87,000 32.5c for each $1
$87,001 – $180,000 $28,275 plus 37c for each $1 over $87,000
$180,001 and over $62,685 plus 45c for each $1 over $180,000

Putting into consideration that Manpreet’s taxable income is $45,000, it falls under the category of 0-$87,00 which is taxed at the rate of 32.5c for every $1. Therefore, the total rax that she will required to pay will be
$1= 32.5c
$45,000 = ?
(45,000*32.5) /100= $14625
Therefore, based on the calculations featured above, Manpreet will have to pay a tax of around $14625.

References
Beloff, Michael, Tim Kerr, Marie Demetriou, and Rupert Beloff. Sports law. Bloomsbury Publishing, 2012.
Braithwaite, Valerie, and Monika Reinhart. “The Taxpayers’ Charter: Does the Australian Tax Office comply and who benefits?.” (2000).
Krever, Richard. “Taming complexity in Australian income tax.” (2003).
Pinto, D. (2011). Taxation of financial transactions. In Australian Taxation Law (pp. 1239-1326). CCH Australia Limited.
Tran-Nam, Binh, and Chris Evans. “Tax policy simplification: An evaluation of the proposal for a standard deduction for work related expenses.” (2012).

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