Taxation Theory, Practise and Law: Input Tax Credit Entitlements and Capital Gain Tax Consequences

Running head: TAXATION THEORY, PRACTISE AND LAW
Taxation theory, practise and law
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TAXATION THEORY, PRACTISE AND LAW
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Table of Contents
Answer to Question 1: City Sky Co of the input tax credit entitlements analysis.........2
Answer to Question 2:..................................................................................................3
1. Capital gain tax (CGT) consequences of Emma’s for the financial year of 2015:. . .3
2. Detecting the legal issues utilised in calculating the CGT consequence of Emma
for 2015:........................................................................................................................5
References:..................................................................................................................6

TAXATION THEORY, PRACTISE AND LAW
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Answer to Question 1: City Sky Co of the input tax credit entitlements analysis
One of the major decisions that were made by the Australian tax organisation
was regarding the goods and services tax that was imposed on organisations
operating in Australian land. The goods and services tax are mainly calculated on
most of the transactions that is conducted within Australia. The goods and service
Tax act relatively provides information regarding the overall actions that needs to be
imposed by organisation under certain scenarios and transactions, as it would help
them to determine the actual GST payable at the end of the year. In addition, the
case examines is relatively conducted for City Sky Co, which is registered under the
organisation act eligible for availing input tax credit whenever it is applicable for the
organisation. The analysis directly indicates that adequate credit condition needs to
be satisfied for the organisation to avail the GST credit from the transactions
(Ato.gov.au, 2019).
The certain GST credit conditions needs to be maintained, where tax invoices
need to be upheld from the supplier, as relevant GST needs to be paid on purchases
of the goods that is been purchased. In addition, the GST ACT also requires the
organisation to register within under the ACT, as it will be helpful in claiming the tax
input credit for the transaction under the GST. Further, requirements of GST
regulations have indicated that the overall GST input tax credit can be claimed within
4 years. Lastly, relevant GST tax credit for the organisation needs to be submitted by
the company to the ATO to adequately creating the tax credit for the financial year
(Ato.gov.au, 2019).
The case analysis of city sky organisation is relatively evaluated for identifying
the measures that can be taken by the organisation to claim the relevant GST credits
from their transactions. From the relevant evaluation, it is determined that the
company has been registered under the GST act, which enables the organisation to
claim relevant tax credits on purchases for both goods and services. Moreover, the
company has been planning to develop residential 15 properties vacant land to be
sold separately to different customers (Ato.gov.au, 2019). Additionally, the analysis
also indicates that the organisation is taken services from the local lawyer for the
construction purposes, which relatively states about the overall GST payments that
has been conducted by City Sky Co.
The City Sky Co has purchased immovable property, which is neither goods
or services and therefore it cannot be considered under the GST act. The case study
indicates that no GST will be applicable on the purchase of the vacant land, as it is
considered as provision of black credit, where any goods or serviced used for
construction of the immovable property is relatively not considered under the GST
input tax credit. Therefore, the overall construction materials used by the
organisation to build the apartments is not considered to be under the GST tax input
which directly makes the City Sky Co not eligible for any kind of GST credit. Some
researchers indicated that GST credits can be identified by utilising the relevant laws
and guidelines published by the ATO, as it help the organisation to determine the
credit input it could charge on their purchases.
However, the case study of the City Sky Co also indicates that reliable
services have been taken for sorting out some legal advice from the lawyer.
Therefore, under the GST clause, it could be understood that any GST that has been
paid by the organisation to the lawyer is relatively considered as the GST tax credit
and is eligible to take the relevant refunds. Nonetheless, the analysis has directly