logo

TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author

11 Pages2213 Words31 Views
   

Added on  2021-05-30

About This Document

Laws: “Scott v Commissioner of Taxation (1935)” “Brent v Federal Commissioner of Taxation (1971) ATC 4195” “Section 6-5 of the ITAA 1997” “Hobbs v Hussey (1942) 24 TC 153” Applications: As defined under “section 6-5 of the ITAA 1997” ordinary income includes all the income that are generally derived by the taxpayer from most of the sources (Murphy & Higgins, 2016).

TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author

   Added on 2021-05-30

ShareRelated Documents
Running head: TAXATION LAWTaxation LawName of the StudentName of the UniversityAuthors NoteCourse ID
TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author_1
TAXATION LAW1Table of ContentsAnswer to question 1:.................................................................................................................2Issue:..........................................................................................................................................2Laws:..........................................................................................................................................2Applications:..............................................................................................................................2Conclusion:................................................................................................................................3Answer to question 2:.................................................................................................................4Issue:..........................................................................................................................................4Laws:..........................................................................................................................................4Application:................................................................................................................................4Conclusion:................................................................................................................................5Answer to question 3:.................................................................................................................5Issue:..........................................................................................................................................5Laws:..........................................................................................................................................6Applications:..............................................................................................................................6Conclusion:................................................................................................................................7Reference List:...........................................................................................................................8
TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author_2
TAXATION LAW2Answer to question 1: Issue: Will Jenny be held liable for taxation relating to the income received from thepersonal service for appearing in the interview under section 6-5 of the ITAA 1997? Laws: 1.“Scott v Commissioner of Taxation (1935)”2.“Brent v Federal Commissioner of Taxation (1971) ATC 4195”3.“Section 6-5 of the ITAA 1997” 4.“Hobbs v Hussey (1942) 24 TC 153”Applications: As defined under “section 6-5 of the ITAA 1997” ordinary income includes all theincome that are generally derived by the taxpayer from most of the sources (Murphy &Higgins, 2016). As per section 6 of the ITAA 1936 an individual deriving income frompersonal sources refers to the salaries, pension, fees or proceeds of business. According to thedecision in “Scott v Commissioner of Taxation (1935)” the term ordinary income refers to theincome obtained from majority of the sources namely that are in accordance with the ordinaryusage of the mankind. Denoting from the current situation of the Jenny it is understood that she received inadvance a sum of $500,000 from the publisher that expressed an interest in knowing aboutJenny late husband Henry. Jenny appeared in an interview with the publisher for an agreedsum of $1 million along with the advance payment of $500,000. Referring to the definition stated under “section 6-5 of the ITAA 1997” that anelement that has the characteristics of the income when it comes homes for an individual
TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author_3
TAXATION LAW3(Schenk, 2017). An element of income under “section 6-5 of the ITAA 1997” is heldassessable up to the realisable value of the sum. The nature of income must be ascertained inevery situations depending upon the derivation by an individual taxpayer. Referring to the judgement of high court in “Brent v Federal Commissioner ofTaxation (1971) ATC 4195” it was clarified that the sum of payment received narrating thestory of the train robber by the wife was held as taxable income based on reward for service(Hill & Mancino, 2014). The wife of the train robber was granted a special right of telling thestory of her husband to a publication and the amount derived for such reward as held taxablebased on reward for service. In the present condition of Jenny the amount received by thepublisher for appearing in the interview attracts tax liability. The sum received will be taxablewith reference to “section 6-5 of the ITAA 1997” as income from ordinary sources based onreward for service. Alternatively if Jenny decides to write the biography herself and the payment thatwould be derived from such publications would be held as royalties. As held in the case of“Hobbs v Hussey (1942) 24 TC 153” where the taxpayer was regarded at the criminal andreceived amount of £1500 for selling the serial rights of his autobiography that was publishedin the article of twelve newspaper (Bloom & Joyce, 2014). Similarly in case of Jenny, if thebook was written by herself it would have amounted to autobiography and the amountderived from such sale of book will be held taxable. Conclusion: Jenny would be held taxable since the amount received from exclusive interview is anincome that is earned from providing service and assessable under ordinary meaning “section6-5 of the ITAA 1997”. Alternatively, if she decides to write herself the book then thepublications would amount of royalties that would attract tax liability.
TAXATION LAW TAXATION LAW 2 2 Taxation Law Name of the University Author_4

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Taxation laws : Solved Assignment PDF
|12
|2866
|36

Taxation Law
|9
|2626
|96

Sample Assignment on Taxation Law (docs)
|11
|1786
|23

TAXATION LAW 10 10 Taxation Law Name of the University Author
|11
|3868
|429

Taxation Law Answers - Assignment
|7
|2028
|30

Taxation Law: Assessable Income, Fringe Benefits, Interest Income, CGT Assets
|11
|2226
|398