Taxation Law Assignment: Calculating Mitchel's Taxable Income

This Taxation Law assignment presents a detailed calculation of Mitchel's taxable income for two financial years, 2018-19 and 2019-20. It includes the computation of assessable income, comprising gross salaries, interest income, and uniform allowances, followed by the deduction of work-related expenses, union fees, and depreciation. The assignment calculates the total taxable income, tax payable, Medicare levy, and the resulting tax refund. It also compares the tax differences between the two years. The solution demonstrates the application of taxation principles and provides a breakdown of the Pay-As-You-Go (PAYG) tax withheld and the net tax refundable, offering a comprehensive understanding of income tax assessment.

Running head: TAXATION LAW
Taxation Law
Name of the Student
Name of the University
Authors Note
Course ID

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Table of Contents
Answer to question 1:.................................................................................................................2
Determination of Mitchel’s Taxable Income.............................................................................2
Answer B:...................................................................................................................................2
Answer to C:..............................................................................................................................3
Answer to D:..............................................................................................................................4
Reference:..................................................................................................................................5

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Answer to question 1:
Determination of Mitchel’s Taxable Income
Computation of Taxable Income
In the books of Mitchel
For the year ended 30 June 2018-19
Particulars Amount ($) Amount ($)
Assessable Income
Gross salaries 31,050.00
Australian Sourced Interest Income
Term Deposit (5000 x 2.65%) x 10 months 1,325.00
Uniform Allowances 350.00
Total Assessable Income 32,725.00
Allowable Deductions
Work related travel expenses 1,157.00
Union fees 110.00
Depreciation for Tablet 299.67
Total Allowable Deductions 1,566.67
Total Taxable income 31,158.33
Answer B:
Computation of Taxable Income
In the books of Mitchel
For the year ended 30 June 2018-19
Particulars Amount ($) Amount ($)
Assessable Income
Gross salaries 31,050.00
Australian Sourced Interest Income
Term Deposit (5000 x 2.65%) x 10 months 1,325.00
Uniform Allowances 350.00
Total Assessable Income 32,725.00
Allowable Deductions
Work related travel expenses 1,157.00
Union fees 110.00
Depreciation for Tablet 299.67

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Total Allowable Deductions 1,566.67
Total Taxable income 31,158.33
Tax on Taxable Income 2,662.20
Add: Medicare Levy 623.17
Gross Total Tax Payable 3,285.37
Answer to C:
Computation of Taxable Income
In the books of Mitchel
For the year ended 30 June 2018-19
Particulars Amount ($) Amount ($)
Assessable Income
Gross salaries 31,050.00
Australian Sourced Interest Income
Term Deposit (5000 x 2.65%) x 10 months 1,325.00
Uniform Allowances 350.00
Total Assessable Income 32,725.00
Allowable Deductions
Work related travel expenses 1,157.00
Union fees 110.00
Depreciation for Tablet 299.67
Total Allowable Deductions 1,566.67
Total Taxable income 31,158.33
Tax on Taxable Income 2,662.20
Add: Medicare Levy 623.17
Gross Total Tax Payable 3,285.37
Less: PayG withheld 8,694.00
Net Tax Refundable -5,408.63
As Mitchel has paid $189 per week as the PAYG tax instalment all through his
employment he will be entitled to refund of $5,408.63 from the ATO.

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Answer to D:
Computation of Taxable Income
In the books of Mitchel
For the year ended 30 June 2019-20
Particulars Amount ($) Amount ($)
Assessable Income
Gross salaries
Wages for Day Time 12,420.00
Wages for Night Time 20,958.75
Australian Sourced Interest Income
Term Deposit (5000 x 2.65%) x 10 months 1,325.00
Uniform Allowances 350.00
Total Assessable Income 35,053.75
Allowable Deductions
Work related travel expenses 1,157.00
Union fees 110.00
Depreciation for Tablet 299.67
Total Allowable Deductions 1,566.67
Total Taxable income 33,487.08
Tax on Taxable Income 2,662.20
Add: Medicare Levy 669.74
Gross Total Tax Payable 3,331.94
Less: PayG withheld 8,694.00
Net Tax Refundable -5,362.06
Tax differences:
Percentage of Tax Difference 2019 2020 (% Tax Diff)
Gross Taxes Payable 3,285.37 3,331.94 1.42%

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Reference:
Barkoczy, S., 2016. Foundations of taxation law 2016. OUP Catalogue.
Sadiq, K., 2019. Australian Taxation Law Cases 2019. Thomson Reuters.