Taxation Theory, Practice & Law Assignment (Doc)
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Added on 2020-10-23
Taxation Theory, Practice & Law Assignment (Doc)
Added on 2020-10-23
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TAXATION THEORY, PRACTICE &LAW
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1QUESTION 1...................................................................................................................................1Measuring the capital gain tax in the income tax...................................................................1QUESTION 2...................................................................................................................................7Measuring the liabilities if FBT in respects with relevant information..................................7Analysing income of husband and wife.................................................................................9CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONTaxation practices in analysing the assessable income and net tax will be payable by anindustry or an individual is necessary. Thus, net worth of any concern has to be taxed withproper analysis and measurements. In the present report, there will be discussion based on capitalgain tax analysis as well as assessment income of couple resident in Australia. However, thisreport will bring various measurement and determination of taxes on the basis of tax rulings, actsand regulations enacted by Australian Taxation Office (ATO). A clear demonstration of allcalculations and analysis will bring information relevant with authentic framework of suchregulatory.QUESTION 1Measuring the capital gain tax in the income tax Capital Gain Tax: The purchase and sale of any asset is basically reflecting differences inamount. Thus, such variations will reflect positive or negative outcomes determines capital gainof loss incurred on such property (Sowa and et.al., 2018). However, it will be measured andanalysed in income tax returns of an individual. It will directly add in assessable income of aperson which will significantly raises tax (Lawrence and Bennett, 2017). Moreover, in the belowlisted analysis there have been various assets which were being bought and sold by an individual.Thus, there will be measurement of capital gain tax to analyse the taxes which are needed to bepayable by them (White and Townsend, 2018). The analysis of CGT on various assets such asBlock of vacant land, Antique bed, Painting, shares and Violin is as follows.ParticularsAmount in($)Vacant block of landPurchase price of vacant block100000add: local council20000cost base unindexed120000Sale of land320000less: cost base unindexed120000440000With provision of 1 sept. 1999 discount will beapplicable as per reducing the 50% cost of asset intaxation220000Capital gain2200001
Interpretation:In analyzing the profitability retained by individual in context with thepurchase and sale of various assets. Thus, Block of vacant land has been bought by him in 2001.Similarly, it has been sold at the cost of $320000. To determine the effective capital gain taxamount, there will be determination of various techniques and implication of such aspects will behelpful in bringing the qualitative analysis. However, as per considering the three norms whichare being enacted in CGT analysis such as after 1985, 1999 and within 12 months. Therefore,land was purchased in 2001 on which discounting technique were has to be implicated that states50% of the Capital gain or loss will be charged. Moreover, there capital gain taxable here willbe$220000.Antique Bed:ParticularsAmount in($)Antique bedPurchase price of antique bed3500Add: alteration cost1500Add: amount of household content11000cost base unindexed16000sale of bed25000less: cost base unindexed160009000With provision of 1 sept. 1999 discount will beapplicableIndexed Capital gain4500Interpretation:As per analyzing the above listed determination of operation whichascertains that there has been measurement of capital gain tax on Antique Bed which werebought by an individual. The purchase costs of the bed in 1986 was $3500 on which a minoralternation has been made amounted to $1500. Similarly, the insurance claim has been made byowner with respect with the bed on which they have agreed on bringing $11000 as an insuranceclaim. Moreover, here the cost base unindexed has been measured as $16000. The bed was soldfor $25000 which in total brings the total capital gain of $9000. As per considering thediscounting technique on which there have been charges levied on 50% of the total gains such as$4500 will be taxable.2
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