LAWS20060 Taxation Law | Fringe Benefit Tax or Taxable Income

Added on -2020-02-18

| LAWS20060| 12 pages| 3161 words| 691 views

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Running head: TAXATION LAW OF AUSTRALIATaxation Law of AustraliaName of the Student:Name of the University:Author’s Note:Course ID:
1TAXATION LAW OF AUSTRALIATable of ContentsAnswer to Question 1:.....................................................................................................................2Answer to Part i:..........................................................................................................................2Answer to Part ii:.........................................................................................................................2Answer to Part iii:........................................................................................................................3Answer to Part iv:........................................................................................................................3Answer to Part v:.........................................................................................................................4Answer to Part vi:........................................................................................................................4Answer to Part vii:.......................................................................................................................5Answer to Part viii:......................................................................................................................5Answer to Part ix:........................................................................................................................6Answer to Part x:.........................................................................................................................6Answer to Question 2:.....................................................................................................................7References:....................................................................................................................................11
2TAXATION LAW OF AUSTRALIAAnswer to Question 1:Answer to Part i:The condition mainly identifies that there are pertinent benefits given to a businessanalyst availing Webjet. Under the normal scenario, such benefits that the airline firms haveprovided are not taken into account under taxable income, as laid out in “Taxation Ruling of TR1999/6”. However, the ruling of Australian taxation depicts that certain criteria are evident that isrequired to be met before allowing the expenditure in the form of tax exemption. The totalbenefit that Webjet has provided is not taken into account under fringe benefit tax or taxableincome until such influential dynamics are proved. An association between an employer and anemployee exists, when they treat each other as family members. Moreover, the reward points areprovided to the staffs in relation to the agreement of employment. Finally, Webjet has madecertain arrangements for the flight points. However, dissection of the scenario primarily depictsno agreement between the staffs and Webjet or the employer and Webjet, in which the benefit isexcluded from taxable income (McGregor-Lowndes 2014). Answer to Part ii:According to the case study, the organisation has received a pertinent compensation froma customer in lieu of damages carried out on the capital asset. In compliance with the taxationlaw of Australia, the payment of total damage could not be taken into consideration undertaxable income. In addition, there are various criteria that an organisation should follow forexcluding the payment of damage related to capital assets in the form of capital income. Initially,the organisation needs to utilise its assets effectively that would help in minimising the taxableincome. The second measure depicts that the capital asset is listed on the annual report, in which
3TAXATION LAW OF AUSTRALIAthe conduction of sufficient depreciation is made. This is extremely significant, since it enablesthe taxation authority of the nation in understanding that the organisation uses the capital assetfor above a fiscal year (Bryan, Vann and Thomas 2017). Answer to Part iii:According to the provided scenario, the manager of the nightclub has been provided witha pertinent holiday package on the part of the alcohol supplier. The pertinent arrangementprimarily denotes that the alcohol supplier has provided a gift or benefit having relatively greatervalue. In accordance with the taxation authority of Australia, the gifts of low budget areexempted from taxable income, while the gifts of high budget are included in taxable income.This enables in reducing any type of unscrupulous actions carried out on the part of owners andstaffs. Along with this, the scenario denotes that the holiday package has greater value, in whichthe nightclub manager is needed to include benefits in the taxable income. As remarked byMcKerchar, Bloomquist and Pope (2013), the individual staffs receiving advantages from theemployers are adjudged mainly as fringe benefit tax, which is incurred on the part of theemployer. Answer to Part iv:According to the case study, pertinent fund is returned to the members of the Canoe Club,since the collection of additional amount is made. The monetary return from the club is primarilya refund and it could be adjudged as member income. In accordance with the taxation law, anytype of expenditure carried out on clubs for private entertainment is not deductible in nature.Hence, the total fund returns could not be highlighted that the Canoe Club members havereceived. It could be stated that the fund return of the members of the Canoe Club could not betaken into account.

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