Taxation Law

Running head: TAXATION LAW
Taxation Law
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TAXATION LAW1
Table of Contents
Answer to question 1:.................................................................................................................2
Issues:.....................................................................................................................................2
Rule:.......................................................................................................................................2
Application:............................................................................................................................3
Conclusion:............................................................................................................................4
Answer to question 2:.................................................................................................................4
References:.................................................................................................................................9

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Answer to question 1:
Issues:
Whether or not the taxpayer be eligible for claiming input tax credit on the sale of
commercial property under “subsection 29-5 (1) of the GSTR 1999”?
Rule:
GST is only applicable to the sale of certain kind of property given the vendor is
registered for the GST (James 2018). As per the “subsection 29-5 (1)”, GST is generally
considered payable by a person upon selling the land under the standard land contract that are
assessable supply is attributable to the tax period in which the considerations for the supply
was obtained or if any consideration for supply was obtained by the taxpayer, an statement
associated to the supply or the tax period during which the invoice is dispensed.
Accordingly, a taxpayer under the “subsection 29-10 (1) of the GSTR 1999” is
allowed to get input tax credit for the creditable purchase with respect to the standard land
contract that are attributable to the tax period for which the taxpayer has provided any type of
consideration for the acquisition (Morgan, Mortimer and Pinto 2018). A person may also be
permitted to input tax credit if prior to providing any kind of consideration, an invoice
associated to the acquisition is issued. Input tax credit represents the amount that a person is
allowed to offset for the GST that is included into the acquisition price if it was purchased for
use by the company.
A taxpayer is attributable to the input tax credit for the creditable purchase to the
previous tax period in which they deliver any kind of considerations or a statement that is
delivered for the purchase (Morgan and Castelyn 2018). A taxpayer is allowed to claim input
tax credit for the tax period in which they deliver consideration for the acquisition but simply
up to the degree of considerations delivered during that period. A taxpayer that holds the tax

TAXATION LAW3
invoice, then they are considered attributable for the input tax credit for the creditable
purchase of land under the complete standard land agreement during the time in which the
settlement happened.
As stated by the taxation ruling of “GSTR 2000/28”, a person when makes the
taxable supply of land in respect of the complete standard land contract, they are considered
attributable to the GST that is payable to the tax period when the settlement happens (Liu
2018). This generally applies when a person accounts for the GST on the cash basis or if they
don’t keep their books of records for GST on the cash basis. If a taxpayer holds the tax
invoice, then they will be considered attributable to the input tax credit for the creditable
purchase of land under the complete standard land agreement for the tax period where the
payment happens. This is generally applicable when the taxpayer keeps his books of accounts
on the cash base or if they don’t keep their books of records for GST on the cash basis.
The tax treatment relating to land and the proceeds that originates from the sales is
usually reliant on whether the treated as the capital asset or it is subjected to the business or
commercial transaction (Cavenagh et al., 2018). The taxpayers must take into the account that
when the transactions relating to happens as the portion of business activity, the sales
proceeds derived in this case will be held as ordinary income and will be subjected to GST.
Application:
The case study of City Sky Co being a property investment and development
company purchased the vacant piece of land for the purpose building 15 apartments and
selling it thereon. The company here also engaged with the service of local lawyer for
obtaining the legal services that is needed for the development of land. The purchase of land
by City Sky Co for the use of business or the profit making activities and any kind of sales