Taxation

Running head: TAXATION
TAXATION
Name of the Student
Name of the University
Author Note

TAXATION1
Table of Contents
Answer to Question 1......................................................................................................................2
The Issue......................................................................................................................................2
The Rule.......................................................................................................................................2
The Application...........................................................................................................................3
The Conclusion............................................................................................................................4
Answer to Question 2......................................................................................................................6
The Issue......................................................................................................................................6
The Rule.......................................................................................................................................6
The Application...........................................................................................................................7
The Conclusion............................................................................................................................7
Answer to Question 3......................................................................................................................9
The Issue......................................................................................................................................9
The Rule.......................................................................................................................................9
The Application...........................................................................................................................9
The Conclusion..........................................................................................................................10
Reference.......................................................................................................................................11

TAXATION2
Answer to Question 1
The Issue
The primary issue which largely exists in the current scenario relates to that of the CGT
results which arise out of the given transactions which have been undertaken by Helen in lieu of
finding funds for her venture posing a fashion designer:
 An antique painting which Helen`s father had bought in the February of 1985 for $4000.
Helen had made sales of the painting later on 1st December 2018, for a sum of $12000.
 Helen also engaged in the sales of the sculpture which was historical in January, 2018
under a sum of $6000. The painting had been purchased in 1993, December for a sum of
$5500.
 Additionally, she had purchased the antique jewellery back in the October of 1987 for a
sum of $14000. She later sold it for $13000 in March of 2018.
 She made sales of the picture for $5000 in July of 2018 which had been purchased by her
mother back in 1987, March for a sum of $470.
The Rule
According to the S.102.20 of the IT Assessment of 1997, any profit or loss which has
been incurred by the support of the Capital Gain Taxation events, a position of a Capital Gain tax
gain or a loss. The S. 104.10 of the same act renders that if any sales of the CGT assets takes
place then those assets are required to be deemed as a Capital Gain Taxation event as per the A1
category. It has to be noted that this Capital Gain tax lies applicable only for those Capital gain
assets which have been acquired post 20th of September of 1985. Any other asset which has been

TAXATION3
purchased before the prescribed date shall not be taken under the CGT and hence, can be
considered to be under exemption with respect to the above case.
In the S. 108.10(2) of the Act, the term collectible is present. The section goes on to
describe the term as a particular item which generally is owned by the person who pays the taxes
for the personal use or otherwise. This section defines the collectible as the jewellery, folio or
antique objections. The S. 118.10(1) of the particular act tends to mention that a particular
collectible is considered as the capital asset in case it has been undertaken for an amount more
than the sum of $500 and any other collectible will be provided a treatment as an exemption
from this, if the amount is below the prescribed amount.
The S.108.10 describes that the CGT loss which is generally incurred by an individual by
the name of a sales being made of the collectible needs is required to be provided a treatment as
offset in regard to the Corporate Gains Tax gain which are generally incurred by an individual by
any sales made of a collectible item. Hence, in regard to this the loss may not be treated as a
particular offset to any other Capital Gain taxation gain which occurs.
As per the section of 108.20, the tax aspects of the Goods tax assets can be used for the
personal purpose. As per the particular section any such asset which is made used for the purpose
of the business is deemed to be exempted from the taxation if the particular value does not cross
the threshold of more than $10000.
The Application
The first transaction relating to the antique painting which had been bought in the year
1985 for an amount of $4000 had been sold on December 2018 for an amount of $12000.
Hence, this can be considered to be exempted from the Corporate Gain taxation gain as because