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Running head: AUSTRALIAN TAXATION LAW Australian taxation law Name of the University Name of the student Authors note
1 AUSTRALIAN TAXATION LAW Answer to Question 1 Answer of Question i) Aviation companies reward their loyal customers with flight points underTaxation Ruling of TR 1999/6.Under this taxation ruling, companies in aviation sector reward their customers by providing flights points. The fact is that rewards or points that are provided by companies in aviation sector are not treated as taxable income under Taxation Ruling of TR 1999/6 (Barkoczy, 2016). Nonetheless, there can be implementation of fringe tax benefits on rewards or scenarios. Such tax benefits can be imposed under the following situation and they are listed below: If the employees are rewarded with flight points for some type of arrangement. Employer and employees share a relationship of family. Employees receives rewards or flights points from employers in relation and in context to their employment. Therefore, frequent flyer rewards received by business analyst in relation to work related travel by organization would not be subjected to taxation and neither it will be treated for fringe taxation benefits. Answer of Question ii) The amount that is received as a compensation by an individual or entity are not considered for the purpose of taxation or it is not assessed as under taxation income. Under the given scenario, crane-hiring company is receiving amount for customers as compensation for damage due to supplying damaged crane (Blakelock & King, 2017). Here, compensation is paid at time of providing service and receivers of compensation are liable to charge for taxation. Some of crucial points that can be reflected here are as follows:
2 AUSTRALIAN TAXATION LAW Refurbishing the damages assets part are done by amount of compensation that is received by hiring company. Utilization of received compensation amount is done by refurbishing the assets damaged arts. Entities receiving compensation amount should have assets that would be dynamically utilized in their business process and they should be in capital form. Assetsofentitiesmustbedepreciableandestimateddepreciationshouldbe determined concerning assets that are in record. In the given scenario, there has been damage to customers capital assets and in this regard, crane hiring company has received the compensation value. If the above conditions are fulfilled, then the amount is not included for taxation purpose and they are not taxable income. Answer of Question iii) Cash or gift in kind received by individual does not form part of income component according to Australian Taxation Office. Such component are exempted and they form neither part of non-assessable income nor part of non-exempted income. When computing income tax on an individual, value of small gifts received does not form part of computation and hence they are excluded (Campbell et al., 2016). On other hand, some big gifts received by individual would be assessed for income tax purpose in the event when they are able to convert into cash. Therefore, nightclub mangers of an alcohol suppliers has received free package of Free Overseas holiday. Hence, for computing nightclub manager income tax, it is essential to include the package received by him.
3 AUSTRALIAN TAXATION LAW Answer to Question iv) Canoe club for buying additional canoes raised excess funds and this extra amount was returned to their members. When calculating income tax, extra money raised for buying canoes are not included in the same. The reason this part of funds would not be included in calculating income tax is that, as they have not been raised as an alternative funds raised that members provided. Funds raised was not for acquiring purpose and it did not display separate requirement (Nossaman & Wyatt 2016). Answer of Question v) The Taxation RulingsTR 1999/17includes the gains or gifts received by sportsperson for performing fairly and due to their best performance on field. According to taxation rule, the amount that is received by sportsperson as gifts or any cash received by them are subject to taxation. In addition, if such receipts of gifts or cash accumulate form part of their income. Therefore, as per normal taxation concept, payment received by Australian footballer by Australian television for best and fair performance should be included in their income tax calculation (Kingston, 2015). Answer of Question vi) Taxation Ruling of TR 95/22 depicts components such as allowance, reimbursing employees and construction. Building of employees and construction include the following components according to Taxation Ruling of TR 95/22. Carpenter, apprentice and trainees Labour involved in carrying out construction of building\ Project manager in the construction site is engaged in constructing building and many activities
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