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TAX TAX 9 9 Tax Authors Note

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Added on  2019-10-30

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As per GST Act 1999, any business organization operating to earn business income have the right to take input credit for GST payments that involves purchase of materials or assets. As per GST Act 1999, any business organization operating to earn business income have the right to take input credit for GST payments that involves purchase of materials or assets.

TAX TAX 9 9 Tax Authors Note

   Added on 2019-10-30

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Running head: TAXTaxName of the Student:Name of the University:Authors Note:
TAX TAX 9 9 Tax Authors Note_1
TAX1Table of ContentsAnswer to Question 1.................................................................................................................1Answer to Question 2.................................................................................................................2Answer to Question 3.................................................................................................................4Answer to Question 4.................................................................................................................6Reference....................................................................................................................................7
TAX TAX 9 9 Tax Authors Note_2
TAX2Answer to Question 1.The section 4-15 of the Income tax Assessment Act 1997 states that taxable income iscalculated by deducting allowable expenses from the assessable income. A taxpayer ispermitted to claim deduction under section 8-1(1) of the ITAA 1997 for expenses that areincurred on:i.For producing or gaining assessable income;ii.For carrying on the activity related to business.Thus,1.Section 8-1 provides that expenses incurred to move a machinery will be consideredfor deduction only if that machinery is used to earn an income that is taxable. In thecase of Granite Supply Association Ltd v Kitton(1905) and Smith v WestinghouseBrake Company(1888) it was held that the expenses incurred for relocating plant andexpenditure will not be allowed as deduction as the expenses are of capital nature. 2.Section 8-1 of ITAA 1997 states that cost of revaluation of an asset is not consideredas deductible expense1.3.Section 8-1 provides that any expenditure relating to lawful proceedings is suffered tooppose company’s winding up then it will be considered as deductible expenditure.4.Under section 8-1 in order to earn business income, if any solicitor expenditure isexperienced then such expenditure shall also be treated as permissible deduction.Answer to Question 2.On any purchase by a business organization, GST input credit is permissible only ifappropriate documents relating to such transactions are properly kept. As per GST Act 1999,1 Gitman, Lawrence J., Roger Juchau, and Jack Flanagan.Principles of managerial finance. Pearson HigherEducation AU, 2015.
TAX TAX 9 9 Tax Authors Note_3

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