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Assignment on Income Tax Assessment Act

   

Added on  2020-04-07

15 Pages2018 Words32 Views
Running head: TAXATION LAW Taxation LawName of the StudentName of the UniversityAuthor Note
Assignment on Income Tax Assessment Act_1
1TAXATION LAW Table of ContentsAnswer 1:.........................................................................................................................................2Requirement 1:.............................................................................................................................2Issue:........................................................................................................................................2Legislation:..............................................................................................................................2Application:.............................................................................................................................2Conclusion:..............................................................................................................................3Requirement 2:.............................................................................................................................3Issue:........................................................................................................................................3Legislation:..............................................................................................................................3Application:.............................................................................................................................3Conclusion:..............................................................................................................................4Requirement 3:.............................................................................................................................4Issue:........................................................................................................................................4Legislation:..............................................................................................................................4Application:.............................................................................................................................4Conclusion:..............................................................................................................................5Requirement 4:.............................................................................................................................5Issue:........................................................................................................................................5Legislation:..............................................................................................................................5
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2TAXATION LAW Application:.............................................................................................................................6Conclusion:..............................................................................................................................6Answer 2:.........................................................................................................................................7Issue:............................................................................................................................................7Legislation:..................................................................................................................................7Application:.................................................................................................................................7Conclusion:..................................................................................................................................9Answer 3:.......................................................................................................................................10Answer 4:.......................................................................................................................................12References:....................................................................................................................................13
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3TAXATION LAW Answer 1: Requirement 1: Issue: In this issue it is to be seen whether the cost incurred to move a machinery from one siteto another new site shall be treated as eligible for deductions with respect to “section 8-1 of theITAA 1997”. Legislation: a.“Section 8-1 of the Income Tax Assessment Act 1997” b.“British Insulated & Helsby Cables” Application: Under the “section 8-1 of the Income Tax Assessment Act 1997”, the cost incurred by afirm in relocating its machinery to a new site falls under the nature of capital and therefore, is noteligible to any deductions. If seen from the aspect of depreciation, movement of machinery to anew site may increase the cost of asset. The cost of moving machinery falls under the domain ofthe cost of small changes. It shall be allowed for deductions. The reason for considering iteligible to deductions the cost is a part of the day-to-day business expenses1. The “British Insulated & Helsby Cables” case verdict states that the cost of transferringmachinery leads to the benefit of the business premises due to the shifting of assets, which aredepreciable. As under “Taxation Ruling of TD 93/126”, in case of installing a machinery in newpremises, the cost of bringing it in operation will be seen as revenue and therefore, in this case,1 Barkoczy, Stephen. "Foundations of Taxation Law 2016."OUP Catalogue(2016).
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