Taxation Law

Running head: TAXATION LAW
Taxation Law
Name of the Student
Name of the University
Author Note

1TAXATION LAW
Question No.1
Answer No.1
The question here in this case is the result of Helen selling antique painting in respect of
taxation of capital gain related to Income Tax Assessment Act 1997.
According to section 108.10 of Income Tax Assessment Act 1997, a painting of antique
nature is considered as a collectible item and assessed as CGT asset. According to s.102.2 of
Income Tax Assessment Act 1997, both CGT gain and loss always accompanies the CGT event
listed in section 104.5 of said Income Tax Assessment Act 1997. If the CGT loss or gain does
not accompanying the CGT event listed in section 104.5 of Income Tax Assessment Act 1997, it
will not come under the purview of the definition of collectible and will not be assessed as CGT
asset. As mentioned in s.104.10 of the Income Tax Assessment Act 1997, when the CGT asset
disposes off it leads to the happening of A1 CGT event. According to s.109.5 of Income Tax
Assessment Act 1997, the ownership is conferred upon a taxpayer when he acquires a CGT
asset.
In this scenario, the acquisitioning time of the aforesaid painting has not been provided.
The fact is that Helen’s father has acquired the painting. On or after 20.09.1985, the painting is
to be acquired in order to be assessed as CGT asset. The painting would be considered as a
collectible item and accordingly subjected to CGT if it complies with the required date. The
calculation of CGT loss or gain is generally done by deduction of cost base lower and proceeded
cost from another one. In this current situation cost base would be the price acquisitioned
amounting $4,000. As the painting is being purchased by Helen’s father the ownership would be
transferred to her either after her father’s death or by gift. Such event requires the alteration of

2TAXATION LAW
the cost base in relation to the market value which existed at the acquisitioning time under
s.112.20 of the Income Tax Assessment Act 1997. The proceeded capital would imply the
obtained price by sale amounting $12000. Under division 115 a 50% discount may be allowed to
the event if the taxpayer sells the involved asset for a exceeding period of one year.
Answer No.2
The question here in this case is the result of Helen selling historical sculpture in respect
of taxation of capital gain Income Tax Assessment Act 1997.
According to section 108.10 of Income Tax Assessment Act 1997, a historical sculpture
is considered as a collectible item and assessed as CGT asset. According to s.102.2 of Income
Tax Assessment Act 1997, both CGT gain and loss always accompanies the CGT event listed in
section 104.5 of Income Tax Assessment Act 1997. If the CGT loss or gain does not
accompanying the CGT event listed in section 104.5 of Income Tax Assessment Act 1997, it will
not come under the purview of the definition of collectible and will not be assessed as CGT
asset. As mentioned in s.104.10 of the Income Tax Assessment Act 1997, when the CGT asset
disposes off it leads to the happening of A1 CGT event. According to s.109.5 of Income Tax
Assessment Act 1997, the ownership is conferred upon a taxpayer when he acquires a CGT
asset.
Helen acquired the sculpture on December 1993. On or after 20.09.1985, the painting is
to be acquired in order to be assessed as CGT asset. An asset would be excluded from CGT asset
list if it is acquired preceding the date prescribed. In this matter the sculpture complied with the
required date thus will be admitted as collectible as well as CGT. The calculation of CGT loss or
gain is generally done by deduction of cost base lower and proceeded cost from another one. In