Taxation Law of Australia : Report

TAXATION LAW

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Question 1........................................................................................................................................1
1 Cost of moving machinery to new site................................................................................1
2 Cost of revaluing assets to effect insurance cover...............................................................1
3 Legal expenses of company.................................................................................................1
4 Legal expenses on various cost matters...............................................................................2
Question 2........................................................................................................................................2
Question 3........................................................................................................................................3
Question 4........................................................................................................................................5
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Taxation law of Australia consists with the various laws included in it which are mainly
based on the different levels of governments. For instance, local government, state and federal
governments which are generated by the public services and transfer payments. Income Tax of
Australia is the most common and significant which is gathered by the federal legislation from
Australian Taxation Office (Woellner and et.al., 2011). The revenue of the GST can be collected
by the federal government and Commonwealth Grants Commission are to be paid by the states.
The taxation laws are imposed to reduce the burden over other taxes and provide facilities for
government to focus over developing the rate of GDP. There can be use of various techniques
and discussions about the implication of these laws.
Question 1
1 Cost of moving machinery to new site
Under sections 8-1 of ITAA, 1997 the cost of travelling cannot be deductible. Cost of
moving the fixed assets of the organisation from one place to another and then re-installation of
such machinery cannot be exempted because it is a capital expenditure. The expenses somehow
raises the cost of the item which will be affecting the depreciation of such assets (Industry and
Trade, 2014).
2 Cost of revaluing assets to effect insurance cover
Income Tax Assessment Act, 1997 has facilitated the allowances to deduct the insurance
expenses incurred on revaluing assets. The deductibility can be motivated or expanded on
expenses if the income-earning capabilities or it can be reserve or protect the insurance cover.
(Barkoczy, 2016). This can be facilitating the deductions under section 8-1 which allows to
lowering the costs of revaluing the assets which affects insurance. One can easily claim
insurance in accordance with any damage occurred on assets. It will be helpful in recovering
costs that will be fruitful in overcoming expenses or losses (Industry and Trade, 2014).
3 Legal expenses of company
The issue can be related with the expenditure based on structure and income- earning
ability of the entity or its functioning. It depends on the outcome of the cases that will result in
capacity of profit acquisition (Snape and De Souza, 2016). As per this issue that expenses or
1