Taxation Law Small Business Question Answer 2022

Running head: TAXATION LAW
Taxation Law
Name of the Student
Name of the University
Authors Note
Course ID

TAXATION LAW1
Table of Contents
Question 1:.................................................................................................................................2
Income........................................................................................................................................3
References:.................................................................................................................................6

TAXATION LAW2
Question 1:
Omega Pty Ltd: Explain why Omega (turnover for 2017/18 was $9 million which is
less than $10 million) is small business entity.
Answer:
To meet the requirements under the small business concessions, a taxpayer is required
understand whether their business is regarded as the SBE throughout the income year
(Douglas and Pejoska 2017). The taxpayer is also required to review their eligibility each
year. In order to decide the suitability of the SBE concessions, the taxpayer at the initial
stages is required to determine if they are SBE throughout the income year.
An entity is considered as the SBE if they are considered as the sole trader, enterprise,
and corporation or trust that is conducting the business either partly or wholly for the income
year and has the aggregate turnover of lower than $10 million. As noticed in case of Omega
Pty Ltd for the year 2017/18 the company has reported the yearly turnover of $9 million
(Chardon, Freudenberg and Brimble 2016). The company will be treated as small business
entity because its turnover is less than the threshold limit of less than $10 million and has
been carrying on the business activities for full portion of the income year. As a result it can
avail the SBE concession as and when required.
Income
Item Assessable
or not
Amount
assessable
Reasons/Law
Sales
revenue
$8,500,000
Assessable $8,500,000 s 6-5 ITAA 97
The sales revenue constitute business gains that
has resulted from carrying the business activity.