Objections to Disallowance of Deductions

TAXATION LAWS

TABLE OF CONTENTS
TABLE OF CONTENTS................................................................................................................2
PART A...........................................................................................................................................1
PART B...........................................................................................................................................2
1) Objections to be made against disallowance of deductions...................................................4
2). The objection process, and any relevant time frames of which Julie should be aware..........7
3). Julie should include the administrative fees charged by the property manager of her rental
property in her 2018 income tax return.......................................................................................8
REFERENCES..............................................................................................................................11

PART A
Rachel is born is Canadian resident who moved to Australia in year 2006 with her family an
husband. She admitted her sons in the local primary school for their education. Rachel and her
husband bought jointly a house in Australia and also opened a joint account in Australian for
having salary from the job. She moved to Australia due to her job. She maintained the Australia
account along with the bank account in Canada. Her husband did not found suitable job in
Australia.
As the Brisbane was very hot she decided of not raising the children in Australia. Also she
was not getting satisfaction from her job and also was missing her family. Due to these reasons
she secured a job in Canada in 2018 and left for her job on 1st July of 2018. That means mean the
first of starting of financial year. She left Australia nearly 11 years after residing in Australia
with her family. She left but her children and husband lived for completing their schooling year.
She returned to Australia on visit for 1 month in December and left with whole family on 1
January 2019. She left by selling her home in Australia. She did not return back to Australia in
the year and settled back in Canada.
For checking the residency of Rachel for the income tax purpose residency tax will be
applied. Residency will be assessed for the assessment year 2019-20.
The three test are :
Residency Test Provisions Implications
Reside Test It involves considering intention
of presence, business family,
assets location and living
arrangements of the individual
(Maley and Maley, 2018).
Rachel did not satisfy the
Resides as she is not present in
Australia for considerable
period of time. She did not
intend to reside in Australia as
she sold the house and returned
only for one month during the
year. Family also left by selling
social and living arrangements
in Australia.
Domicile Test Domicile inspects the place of
residence.
As per the proviso’s of Domicile
test Rachel will be considered
1

This applies where the period of
stay is lengthy outside Australia
and the resides test is failed. It
identifies the permanent place of
abode and with factors such as
home overseas, residence in
Australia and financial ties.
Person is considered resident of if
there is no place of residence
abode and is moving constantly
within country.
Australian resident as she was
not having permanent place of
abode in Canada on leaving
Australia and was also having
financial ties in Australia
(Sadiq, 2019). The family was
living in Australia and the house
was sold in December.
183 day Test This test requires to satisfy that
usual abode place is out of
Australia. This requires the person
to be present for period of 183
days in financial year if the place
of abode is out of Australia.
This test does not apply as
Rachel is having permanent
residence in Australia in the
financial year.
Conclusion
Rachel is considered to be resident of Australia for the income tax purpose as she satisfies the
domicile test under the income tax residency tests.
PART B
MEMO
123 Accounting Pty Ltd
To : Douglas Park
From :
Date : 25th April 2020
Subject : Objection to Amended Assessment notice for 2018.
2