(Solution) Taxation Theory, Practice & Law
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Added on 2020-12-18
(Solution) Taxation Theory, Practice & Law
Added on 2020-12-18
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Taxation Theory, Practice& Law
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1a. Block of vacant land...........................................................................................................1b. Antique bed........................................................................................................................2c. Painting...............................................................................................................................3d. Shares.................................................................................................................................4e. Violin..................................................................................................................................6TASK 2............................................................................................................................................7a Advise Rapid-Heat about FBT consequences....................................................................7b. Variation to answer if the Jasmine used 500000 as share investment................................8CONCLUSION................................................................................................................................9REFERENCES..............................................................................................................................10
INTRODUCTIONTaxation theory is the tax system which is concerned with tax brackets and slabs in orderto ascertain tax liabilities for every individual, company or any other institution. As a taxconsultant in Mayfield, New South Wales Australia, various assets which are sold by the clientare analysed in order to ascertain their net taxable amount. In this project report, solutions fortwo case scenarios are provided which are concerned with taxation laws. Various assets alongwith their capital gains are calculated in first scenario. In second scenario advices to a companyis provided in order to assisting them in taxation. The main aim of this report is build aunderstanding about the concept of taxation law and its practicesTASK 1Mayfield, New South Wales is an Australian Suburb in which Australian laws areapplicable. As an tax consultant of this region, all the suggestion and advices provided to clientare related with laws of this region. In Australia, there are different taxation laws for variety ofincome such as Income tax law, GST law and others. In order to provide solution for belowtransactions , Income tax law is used in which various tax regulations such as Capital gain tax(CGT) and Insurance claim tax are used. As a tax consultant, it has been ascertained that theclient is an investor and antique collector and despite of various investments she is not carryingany business due to which all taxation rates of an individual will be applicable on her. Total andnet taxation amount of this client is determined by ascertaining solutions for below queries. a. Block of vacant landCase Scenario: Client is an investor and antique collector, who has signed a contract tosell a block of vacant land for 320000 which was acquired for the value of 100000 and additional20000 which were paid by her for water and land taxes. Selling of a land is kind of capital gaindue to which tax rate of CGT will be applicable to the client. Related Tax and regulations: From the above case scenario it has been ascertained thatCGT will be applicable on the client. According to these regulations, vacant land is a block ofimmovable property which is owned as an investment and was acquired after 20 September1985. According to Australian Taxation Office, Vacant land that is help as a capital asset is1
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