Taxation Theory Practice & Law

Taxation Theory
Practice & Law

Table of Contents
QUESTION 1...................................................................................................................................1
Pablo have to pay Australian tax on any of the salary or not......................................................1
QUESTION 2...................................................................................................................................1
Explanation of the respective outcomes reached by the court on the case of Californian Copper
Syndicate Ltd V Harris................................................................................................................1
QUESTON 3....................................................................................................................................2
GST consequences of the arrangement for the companies..........................................................2
QUESTION 4...................................................................................................................................3
Calculation of the net payable tax by All Sports Ltd for the year ending 30th June 2019..........3
REFENRECES................................................................................................................................4

QUESTION 1
Pablo have to pay Australian tax on any of the salary or not
Taxation could be defined as the liability of individuals and companies which states that all
of them are required to make payment of accurate amount of tax on the income which is
generated during the year. Pablo worked in an Australian company for 1 month and received
salary of 120000 dollars. The amount was transferred in the Portuguese bank account. The salary
which is generated in Australia will be taxable in the country. As Pablo is a non-resident so the
tax which will be required to be paid by him will be paid at the non-resident withholding rates
for the income received. The tax rate at which non residents pay tax in Australia is 32.5%. It is
the minimum rate at which non residents are paying tax in Australia (Gavrilova and Makarov,
2016). The tax which will be paid by Pablo on the income which is generated by Pablo in
Australia. It is 32.5% and the calculation of it is as follows:
Salary generated by Pablo in Australia = 120000
The taxation rate at which amount will be taxable in Australia = 37.5%
So, the tax will be = 120000 * 37.5%
= 45000
The tax which will be paid by Pablo on the salary which is generated in Australia will be
45000 as it is calculated at the rate of non-residents in Australia. If this tax will not be paid by
Pablo then it may result in legal actions against him. Apart from this, the salary which will be
transferred in the Portuguese Bank Account will be provided after making all the appropriate
adjustments for taxation (Kraal, 2016). If the tax will not be deducted then the salary which will
be received in bank will be (120000 - 45000) 75000. On the other hand, if the salary is received
after deduction of the tax then the amount of tax will be (120000 / 62.5 * 100 = 192000) (192000
- 120000) 72000. It is the amount which will be paid by Pablo on the salary which is generated in
Australia but received in Portugal (Sharkey and Murray, 2016).
QUESTION 2
Explanation of the respective outcomes reached by the court on the case of Californian Copper
Syndicate Ltd V Harris
The respective outcome on the case of Californian Copper is concretion of Lord Young.
Young concurred that determination of commissioners is right. According to Lord, the case of
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