Taxation Law: Understanding Tax Calculations and Deductions for Kate

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

1TAXATION LAW
Table of Contents
Headings:....................................................................................................................................2
Issue:..........................................................................................................................................2
Rule:...........................................................................................................................................2
Applications:..............................................................................................................................4
Conclusion:................................................................................................................................6
Reference List:...........................................................................................................................8

2TAXATION LAW
Headings:
The study is related to the ascertainment of tax calculations for Kate based on the
amount of income that is earned by her in 2017-18 and the deductions that she can claim
under “section 8-1 of the ITAA 1997”.
Issue:
The issue here is associated in understanding the income received as salary and other
relevant issues that she has reported in the income year. The issue here is understanding
whether Kate shall be permitted to claim an allowable deduction under “section 8-1 of the
ITAA 1997”. Additionally, the issues consider the taxability of income for Kate under
“section 6-5 of the ITAA 1997”.
Rule:
An individual that earns the income from the personal exertion generally derives
income from the salaries, wages, fees or bonuses. The income from personal exertion is
classified under the “section 6-1 of the ITAA 1997” as income from their personal effort
(Woellner et al. 2016). The Australian high court in “Scott v Commissioner of Taxation
(1935)” explained that income that is obtained from the ordinary concepts is regarded as
ordinary income under “section 6-5 of the ITAA 1997”.
Meaning the definition in “section 20 of the FBTAA 1986” fringe benefit expenses
takes place when the employee is provided with the expenses by the employer (Basu 2016).
Any kind of ordinary award are not held as income provided there is any kind of satisfactory
reason for that is associated to the earnings activities of the taxpayer. Signifying the verdict in
“Kelly v FCT” the taxpayer was the footballer that received the fair play award (Barkoczy
2016). The amount that was received by the Football player would be considered taxable
income since it was related with the income producing activities of the taxpayer.