This homework assignment focuses on the principles of taxation within the Australian context, specifically analyzing the Income Tax Assessment Act 1997 (ITAA 1997). The solution addresses two key questions. The first question examines the deductibility of various expenses under section 8-1 of the ITAA 1997, including the costs of moving machinery, revaluing assets for insurance, legal expenses related to winding-up petitions, and general legal advice. The analysis differentiates between capital and revenue expenditures, determining whether each expense qualifies for tax deductions. The second question addresses GST credits, specifically for Big Bank's new product launch. It outlines the requirements for claiming input tax credits, considering creditable and non-creditable acquisitions related to advertising campaigns. It also provides a method for apportioning advertising expenditure between taxable and input-taxed supplies. The assignment solution is supported by references to relevant Australian government publications and legal resources.
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