Tax Calculation & Deductions Analysis
Added on 2020-04-01
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HA3042 Assessment 2Australian taxation law
TABLE OF CONTENTSCase study 1...............................................................................................................................3Issue........................................................................................................................................3Legal provisions.....................................................................................................................3Conclusion..............................................................................................................................4Case study 2...............................................................................................................................4Issue........................................................................................................................................4Legal provisions.....................................................................................................................4Application and Conclusion...................................................................................................5Case Study 3...............................................................................................................................5Issue........................................................................................................................................5Legal provisions.....................................................................................................................5Applicability and conclusion..................................................................................................5Case study 4...............................................................................................................................8Issue........................................................................................................................................8Legal provisions.....................................................................................................................8Applicability and conclusion..................................................................................................8References................................................................................................................................10
CASE STUDY 1IssueIn this present case, interpretation and analysis of specified four expensed will be done inorder to determine if or if not they are entitled to deduction as per the section 8(1) of ITAA1997.Legal provisionsUnder the provisions provided by ITAA97 s 8-1, a general deductibility is a loss accruedwhich are related those income generation activities such as investments, personal efforts,capital nature of business activities (Somers and Eynaud, 2015). According to ITAA97Section 8(5), specific deduction refers to deductions which are not covered in provisions ofgeneral deduction. Deductibility provisions are also inclusive of expenses that cannot bededucted. In accordance with the ITAA 1997 Section 8(1) General deductions; loss or expenditure canbe subtracted from taxable income to the cited extentIf it is incurred while producing taxable income If it is incurred while carrying a business with the intention of gaining taxable income it has been outstandingIn accordance with the ITAA 1997 Section 8-1(2) these losses or outgoing cannot bededucted:If the loss or outgoing is of capital nature or for the purpose of personal useIf the loss is incurred with the object of having personal benefitThe provision of act denies deductionFor gaining exempted income incurredApplication of cited provisionsScenarioAllowableasdeductionReasonCost of moving machinery toa new siteNoNo, as it is considered as a capital expenseCost of revaluing assets YesYes, due to poor information it is allegedthat the benefit is persistent and is incurredfor the purpose of business.Legal expenses for wind upNoIn this event, legal expenses incurred will
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