Holmes Institute, HI6028 Taxation Theory, Practice & Law Assignment

This document presents a comprehensive solution to a taxation assignment, addressing two key issues. The first issue involves City Sky Co., an entity involved in property investment and development, seeking to understand its eligibility for input tax credit (GST credit) on legal fees incurred for property development. The solution analyzes the relevant Australian Taxation Office (ATO) regulations, including GST registration, turnover thresholds, and the applicability of GST to various transactions, ultimately concluding on City Sky Co.'s eligibility for the input tax credit. The second issue concerns Emma, who seeks assistance in filing her annual income tax returns, including the capital gains tax implications of selling a block of land, shares in Rio Tinto, a stamp collection, and a grand piano. The solution delves into the ATO regulations regarding capital gains tax on land sales, collectibles, and personal use assets, considering factors such as acquisition dates, costs, and allowable deductions. The solution calculates the capital gains or losses on each transaction, offering a detailed understanding of how the ATO regulations apply in these real-world scenarios.