Income Tax Assessment Act 1997 - DOC

   

Added on  2020-03-28

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Running head: TAXATION LAW - MASTERS LEVEL - AUSTRALIATaxation Law - Masters Level - Australia Student’s NameCourse Code
Income Tax Assessment Act 1997 - DOC_1
1TAXATION LAW - MASTERS LEVEL - AUSTRALIAAnswer to question 1:Issues:The present situation is based on the representation of total profits from capital or lossincurred by the taxpayer under the ITAA 1997(Ato.gov.au 2017). Legislation:a.Section 108-20 of the Income Tax Assessment Act 1997b.Section 108-10 of the Income Tax Assessment Act 1997(Source: Created by Author)
Income Tax Assessment Act 1997 - DOC_2
2TAXATION LAW - MASTERS LEVEL - AUSTRALIAApplications: a.Loss of $1,000 incurred by selling home theatre system are not permissible for set offas no losses are acceptable on disposal of assets used for personal reasons section108-20 of the ITAA 1997(Ato.gov.au 2017).b.According to the section, 108-10 of the ITAA 1997 collective damages are not to beconsidered against normal gains by selling shares and are balanced only against thecollective gains under section 108-10 of the ITAA 1997 (Ato.gov.au 2017). c.Since Eric has earned gains on the disposal of regular assets and there is no presentordinary capital or any type of appropriate discounts the net capital gain for Eric forthe current year stands $15,000.Conclusion:It can be concluded that, no loss will be permitted for balancing from the disposal ofassets, which is used for private purpose. Hence, Eric has made profits from the sale ofordinary assets. Answer to question 2:Issue:The current problem is related with the definition of Fringe Benefit Tax of thetaxpayer defined under the Fringe Benefit Act 1986 (Ato.gov.au 2017). Legislation:a.Taxation rulings of TR 93/6b.Fringe Benefit Tax Assessment Act 1986
Income Tax Assessment Act 1997 - DOC_3
3TAXATION LAW - MASTERS LEVEL - AUSTRALIAApplication:Calculation of Fringe Benefit Tax(Source: Created by Author)The taxation rulings of TR 93/6 describes that financial institutions sometimes makeprovisions to balance the loan account, which is referred as interest-offset arrangement(Ato.gov.au 2017). These products comply to counter balance interest that is charged by thecustomers and therefore the customers are not responsible to pay any amount of income taxon the benefits rising from the account. In agreement with the Taxation Rulings of TR 93/6if the bank releases Brian from repaying interest on loan then no amount of income tax isneeded to be paid by Brian.
Income Tax Assessment Act 1997 - DOC_4

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