Taxation Law: Personal Service Income and Tax Liability

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

TAXATION LAW1
Table of Contents
Answer to question 1:.................................................................................................................2
Issues:.........................................................................................................................................2
Application:................................................................................................................................2
Application:................................................................................................................................4
Conclusion:................................................................................................................................6
References:.................................................................................................................................7

TAXATION LAW2
Answer to question 1:
Issues:
a. The issues that will be discussed is about the tax concerns of salary received by
taxpayer in the Westpac bank account.
b. Is the airline ticket for vacation in Paris and voucher to cover the expenses while in
Paris will be taxable as ordinary earnings?
c. Is the employment contract of providing services will attract tax liability in respect of
the ordinary sense of “sec 6-5, ITAA 1997”?
d. Is the sign on fees and compensation payment is a taxable proceeds in relation to “sec
6-5, ITAA 97”?
Application:
Receipts which has the relation with the performance of contracts or the provision of
services usually treated as the chargeable earnings for those that receives the money. The
income that is earned from personal efforts must be characterised as the produce or the
occurrence of service.
The definition of personal service income given in “sec 6 ITAA 1936” says that when
a taxpayer receives any money from the employment and from delivering personal services
then those incomes earned by the taxpayer will be liable for tax (Bankman et al. 2018). On
the other hand, the employers will be viewed taxable for the fringe benefit tax. There should
always be the relation with the receipts that is received by a person by rendering the personal
services will be taxable as ordinary income.
There should be the relation between the items of private items and services. The
remuneration that was earned in “Dean v FCT (1997)” by the taxpayer was treated