Business Law: CGT on Antique Painting, Historical Structure, Antique Jewellery and Painting

Running head: BUSINESS LAW
Business Law
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BUSINESS LAW
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Question 1
Part 1
The issue is to determine as to whether Helen incurs a CGT when she sold the antique
painting purchased by her father
The antique painting that Barbara got from her father was a collectible and therefore it
can be considered as a CG asset under 108-10 (2) under the ITAA97. As per section 102.2
CGT shall be trigged when a CGT event A1 is there, as per the table provided under section
104-10(1). When the tax payer becomes the owner, the asset is acquired as held in section
109-5(1) (Barkoczy 2016)
The antique painting was acquired by Helen from her father which he had bought in
September 20 1985. CGT was not introduced at this point of time and therefore the antique
painting would be considered as a pre-CGT asset. The cost base (CB) as per section 110-
25(2) shall be the acquisition price, that is $4000. The painting has been acquired by Helen as
a gift from her father or by way of inheritance, therefore the CB will get modified from the
original price with which it was bought as per section 112-20. The capital proceed shall be
the price in which she sold the product, that is $12000. The CG will be calculated as capital
proceed minus cost base (CB).
Part 2
The issue is to determine as to whether Helen incurs a CGT when she sold the
historical structure
The historical structure that Barbara got from her father was a collectible and
therefore it can be considered as a CG asset under 108-10 (2) under the ITAA97. As per
section 102.2 CGT shall be trigged when a CGT event A1 is there, as per the table provided

BUSINESS LAW
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under section 104-10(1). When the tax payer becomes the owner, the asset is acquired as held
in section 109-5(1) (Barkoczy 2016).
The structure was acquired by Helen in December 1993. CGT was introduced at this
point of time and therefore the structure would be considered as a post CGT asset. The cost
base (CB) as per section 110-25(2) shall be the acquisition price, that is $5500. The painting
has been acquired by Helen as a gift from her father or by way of inheritance, therefore the
CB will get modified from the original price with which it was bought as per section 112-20.
The capital proceed shall be the price in which she sold the product, that is $6000. The CG
will be calculated as capital proceed minus cost base (CB). Therefore the final CG will be
$500.
Part 3
The issue is to determine as to whether Helen incurs a CGT when she sold the antique
jewellery
The antique jewellery that Barbara got from her father was a collectible and therefore
it can be considered as a CG asset under 108-10 (2) under the ITAA97. As per section 102.2
CGT shall be trigged when a CGT event A1 is there, as per the table provided under section
104-10(1). When the tax payer becomes the owner, the asset is acquired as held in section
109-5(1) (Barkoczy 2016).
The antique jewellery was acquired by Helen in October 1987. CGT was introduced
at this point of time and therefore the structure would be considered as a post CGT asset. The
cost base (CB) as per section 110-25(2) shall be the acquisition price, that is $14000. The
jewellery has been acquired by Helen as a gift from her father or by way of inheritance,
therefore the CB will get modified from the original price with which it was bought as per
section 112-20. The capital proceed shall be the price in which she sold the product, that is