Taxation Law

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

1TAXATION LAW
Table of Contents
Question 1..................................................................................................................................2
Part 1......................................................................................................................................2
Part 2......................................................................................................................................2
Part 3......................................................................................................................................3
Part 4......................................................................................................................................3
Question 2..................................................................................................................................4
Part 1......................................................................................................................................4
Part 2......................................................................................................................................5
Question 3..................................................................................................................................6
References..................................................................................................................................8

2TAXATION LAW
Question 1
Part 1
The issue is to determine the capital gain consequences of the Antique painting sold by
Helen.
The antique painting is a collectible and is a capital gain asset as suggested by s.108-10(2)
ITAA97. As stated in s102.2 CGT will only be trigged if there is a CGT event under the table
provided in s104-5. The sale of a CGT asset or its disposal is CGT event A1 under s104-
10(1). The timing of acquiring the asset is when the TP becomes the owner as per s109-5(1)
(Barkoczy 2016).
It is not clear from the facts that when the painting was acquired by Helen. This is because
the painting was purchased by her father. If the painting is purchased before September 20th
1985 it is exempt from CGT as it is a pre-CGT asset. If it is acquired after the date it will be
treated as a collectible. The cost base according to s.110-25(2) Element one will be the
acquisition price of $4000. However, as she may have acquired it through death or by gift,
the CB will be modified by the market value at the time of acquisition as per 112-20. The
capital proceeds will be the sale price of $12000 as per s116.20. The CG will be the Capital
Proceeds deducted by Cost Base. If he holds the asset for more than a year she will be able to
gain a 50% discount on the same under Div 115.
Part 2
The issue is to determine the CGT consequences of the Historical Structure sold by Helen
The Historical Structure sold by Helen is a collectible and is a capital gain asset as suggested
by s.108-10(2) ITAA97. As stated in s102.2 CGT will only be trigged if there is a CGT event
under the table provided in s104-5. The sale of a CGT asset or its disposal is CGT event A1
under s104-10(1). The timing of acquiring the asset is when the TP becomes the owner as