Taxation Law Utilization: Case Study

This assignment examines the application of taxation law in a case study involving Big Bank Ltd. The focus is on their attempt to claim input tax credit for advertising expenses incurred under the GST Act 1999. The analysis utilizes relevant legal provisions, rulings (GSTR 2006/3), and case law (Ronpibon Tin NL v. FC of T) to determine the legitimacy of Big Bank's claim. The assignment also explores the implications of paragraphs 11-5, 15-5, and subsection 15-25 within the context of input tax credit eligibility.

Running head: TAXATION LAW
TAXATION LAW UTILIZATION
Name of the Student
Name of the University
Authors Note

1UTILIZATION OF TAXATION LAW
Table of Contents
Answer to Question 2:................................................................................................................2
Answer to question 3:.................................................................................................................5
Answer to question 4:.................................................................................................................7
References:.................................................................................................................................8

2UTILIZATION OF TAXATION LAW
Answer to Question 2:
Issue that arised in this case:
Issue that arised shows the situation of Big Bank which is measured for evaluating the
input tax credit with respect to the advertising expense that is incurred with under law section
GSTR Act 1999.
Law used:
a. GST Act 1999
b. Paragraphs 11-5 and 15-5
c. Subsection 15-25
d. Goods and Service taxation ruling of GSTR 2006/3
e. Ronpibon Tin NL v. FC of T
Application:
Goods and Service tax law of GSTR 2006/3 shows the methods that can be followed
to evaluate the input tax credit in accordance with management for alteration that is followed
by financial suppliers under the new system of tax GST Act 19991.
Current scenario of Big Bank shows that, Big Bank Ltd has incurred an expense of
$1,650,000 as GST which was added to advertisement expense in the prior year. Thus Big
Bank Ltd follows law under the section GSTR 2006/3 because the company is recognized as
eligible for input tax credit. According to the law if an entity is registered or required to
obtain registration, GST then it shall be liable for creation of taxable supplies. The framework
1 James, S., Sawyer, A. and Wallschutzky, I., 2015. Tax simplification: A review of initiatives in Australia, New Zealand and the United
Kingdom. eJournal of Tax Research, 13(1), p.280.

3UTILIZATION OF TAXATION LAW
under GST law shows that an entity is required to claim input tax credit for the GST inclusive
supplies that is acquired or import for the entity.
Case of Ronpibon Tin NL v. FC of T is applied in analysing the law of GST2. This
includes compulsion in which the method of allocation is adopted which is sensible in the
situation of particular enterprise. Under the paragraph 11-5 and 15-5 to be eligible for
acquisition, acquisition must be creditable in different parts.
Additional requirements of paragraphs 11-5 and 15-5 (a) for an acquisition to be
recognized as creditable , the acquisition must be completely for creditable purpose3. In case
the acquisition is partly for creditable use then it is important to establish the degree of the
creditable use. Now the subsection 15-25 shows that import shall be viewed as creditable if it
is for creditable use. The law under section 11-15 or 15-10 shows that an acquisition
recognized to be creditable if an entity makes the supplies for the purpose of claiming input
tax credit. It is worth here mentioning the advertising expense incurred by Big Bank Ltd was
for the use of creditable acquisition. In respect of the GSTR ruling of 2006/3 Big Bank Ltd
has gone past the economic acquisition threshold boundary and the statement that is issued to
Big Bank Ltd will be allowed for input tax credit for the GST supplies made4.
2 Treasury, A. and Baxter, H., Accounting evidence. interpretation, 89, p.95.
3 "Legal Database". Ato.gov.au, 2017. Online. Internet. 8 Sep. 2017. . Available:
https://www.ato.gov.au/law/view/document?docid=GST/GSTR20063/NAT/ATO/00001.
4 May, Stephen. "Applying the GST to imported digital products and services: Problems and solutions." Tax Specialist 19.3 (2016): 110.

4UTILIZATION OF TAXATION LAW
Conclusion:
Conclusion shows that Big Bank Ltd will be recognized for claim input tax credit in
regard to the GSTR 2006/13 for the sum that is incurred due to advertising expenses for the
purpose of the creditable acquisition.

5UTILIZATION OF TAXATION LAW
Answer to question 3:

6UTILIZATION OF TAXATION LAW

7UTILIZATION OF TAXATION LAW
Answer to question 4:

8UTILIZATION OF TAXATION LAW
References:
"Legal Database". Ato.gov.au, 2017. Online. Internet. 8 Sep. 2017. . Available:
https://www.ato.gov.au/law/view/document?docid=GST/GSTR20063/NAT/ATO/00001
James, S., Sawyer, A. and Wallschutzky, I., 2015. Tax simplification: A review of initiatives
in Australia, New Zealand and the United Kingdom. eJournal of Tax Research, 13(1), p.280.
May, Stephen. "Applying the GST to imported digital products and services: Problems and
solutions." Tax Specialist 19.3 (2016): 110.
Treasury, A. and Baxter, H., Accounting evidence. interpretation, 89, p.95.

9UTILIZATION OF TAXATION LAW