Taxation Law

Running head: TAXATION LAW
Taxation Law
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TAXATION LAW1
Table of Contents
Answer to question 1:.................................................................................................................2
Answer to question 2:.................................................................................................................5
Answer to question 3:.................................................................................................................7
Answer to question 4:...............................................................................................................10
Answer to question 5:...............................................................................................................12
References:...............................................................................................................................16

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Answer to question 1:
Answer A:
Denoting the explanation in “taxation ruling of TR 2019/1” it is associated with
determining when actually a company is conducting its business activities1. This ruling
involves the view of commissioner when the company is carrying its business within the
purview of small business entity stated in “s-23, ITRA 1986” as effective from 2015-16 and
2016-17 income years and inside “s328-110, ITAA 1997”.
Answer B:
The most important rules regarding the manner of computing the deduction for gifts
and contribution has been explained under the “Division 30, ITAA 1997”2.
Answer C:
A person who is a tax resident of Australia and have reported an income of beyond
$180,001 a maximum extent of marginal tax of 45% is applied on them for the income year
of 2019-20.
Answer D:
From the regimes of capital gains tax generally motorcycle and car are not exempted
from the capital gains tax3. They are considered as the personal use asset under “Sec-108-20,
1 Taxation Ruling of TR 2019/1
2 Division 30, Income Tax Assessment Act 1997 (Cth).
3 Sec-108-20, Income Tax Assessment Act 1997 (Cth).

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IITA 1997”. An exemption is only allowed for CGT when the cost base of the motor cycles
and car is below the $10,000.
Answer E:
Under the “s 104-20 (1), ITAA 1997” the GGT event C1 is largely related to end of
CGT asset. The CGT event C1 follows when the taxpayer that owns the CGT asset is lost or
destroyed. Under this event time plays a vital role4. This comprises of when the first
compensation was received by the taxpayer for loss or destruction or if no compensation is
received by the taxpayer following the loss or destruction of CGT asset.
Answer F:
When an individual is viewed as Australian resident then in such case their first
$18,200 annual income is not considered for tax. The sum of $18,200 is viewed as tax-free
amount.
Answer G:
The federal courts judgement in “Hayes v FCT (1956)” denoted that receipts that are
not found to be the produce or reward for service then it is not held as taxable ordinary
returns. The case is viewed as vital because it explains that a gift which is received by the
taxpayer for their personal relation is not treated assessable as ordinary earnings5. While
differentiating amid the non-assessable private gifts and taxable voluntary receipt associated
to service, it is necessary to focus on the type or character of receipts in the hands of
recipient.
4 Sec-104-20, Income Tax Assessment Act 1997 (Cth).
5 Hayes v Federal Commissioner of Taxation (1956) 96 CLR 47