Principle of Taxation Law

Running head: PRINCIPLE OF TAXATION LAW
Principle of Taxation Law
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Authors’ note

1PRINCIPLE OF TAXATION LAW
Table of Contents
Answer to Question 1:........................................................................2
Answer to Question 2:........................................................................3
Answer to Question 3:........................................................................4
Answer to Question 4:........................................................................4
Answer to Question 5:........................................................................5
Answer to Question 6:........................................................................6
Answer to Question 7:........................................................................6
Answer to Question 8:........................................................................7
Answer to Question 9:........................................................................8
Answer to Question 10:......................................................................8
References & Bibliography:..............................................................10

2PRINCIPLE OF TAXATION LAW
Answer to Question 1:
Small Business Enterprises:
Small business enterprises are normally the private corporations,
partnership firms or the sole proprietorships business entity, which is run
by an individual or 2-3 numbers of owners jointly. These business entities
are normally having fewer employees and its amount of annual revenue is
lower comparing with regular sized business corporations. Normally those
businesses are explained as small in terms, so that such entities being
able to use the government benefits and some tax benefits, which are
particularly issued and provided for small business enterprises. In case of
small business enterprises the numbers of employees are normally not
exceeding 20.
Small Business Enterprises as per ATO:
According to the provision issued by Income Tax Assessment Act
1997, an organization is considered as an Small Business Enterprises in
Australia, if the business in caries on by such entity during the current
financial year and if it is completed the following criteria;
 If the amount of aggregate turnover of such organization is not
exceeding the amount of $10 million during the previous year. Or
 According to the provision issued under the
section 328-110 (1)
of ITAA 1997, if the amount of aggregate turnover of such
organization is expecting not to be exceeding the amount of $10
million during the current financial year.
Organizations consider as Small Business Enterprises:
Normally the following organizations are considered as Small
Business Enterprises;
 Non-employing business such as the sole proprietorships business
and partnership business without engagement of any employees.

3PRINCIPLE OF TAXATION LAW
 Micro-business, normally where number of employees are between
1 to 4 people or less.
 Small business with number of employ within 5 to 19.
Answer to Question 2:
Small Business Enterprises are generally considered as the
backbone of Australia’s economy. The small business enterprises are
normally the sole proprietary business firms, partnership firms or the
other firms with fewer employees. In the present situation those business
entities are providing many opportunities for overall economic growth.
Like other big corporation small business Enterprises are not normally
consume so much expense and also not consist large number of
shareholders. So one of the benefit that derived from such enterprises is
using of less tax provisions and no burdens’ of profit distributions.
Generally an example of Small Business Enterprise is the sole
proprietorship business, where one person is consider as the owner of the
business. All the related tax consequences are maintained by such owner
and even at the year ending after due payments the profit is transferred
to his own account. However in case of large corporation such benefits are
normally not derived. Such case the organization is needed to maintain
each and every single tax provisions properly and also at the year ending
need to distribute profit among others.
Due to such various reasons and also to provide proper backbone to
the economic condition of Australia, the local government providing many
beneficial opportunities for Small Business Enterprises, so that such
organization can be able to provide proper contribution on overall
economic development.
In case to provide overall success of the Small Business Enterprises
the Australian tax authority issued many provisions, which is relevant in
case of measurement the tax liability of a Small Business Enterprises.
Such provisions are as follows;