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    Taxation Law Assignment Help Australia

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    Taxation Law Assignment Help Australia


    Answer to question 1

    Point 1

    The event named as CGT can be defined as the different forms of transactions that may result to the capital gain or capital loss. The tax provisions of capital gain are applicable on the actual or specific or realised gains. The area of CGT can be classified in two different segments, pre-CGT and the post-CGT assets ((Evans, Minas and Lim 2015)). The CGT regime involves that the assets purchased before 20thSeptember 1985 that is before the introduction of CGT are exempted from the CGT (Edmonds, 2015). 

    The antique impressionism painting which Helen’s father bought in February 1985 against an amount of $4000 and then she sold that at$12000 on December 1st 2018. This indicates that the asset lies under the exemption category as it was bough before 20th September 1985. This is the reason the asset was treated as the exempted asset.

    Point 2

    According to the “section 108-5 (1), ITAA 1997”, CGT considers any type of legal property or equitable right but it does not include the area of property. As per “section 104-10, ITAA 1997” a removal of CGT asset arises when it is likely to another body (Wolter Kluwer, 2019a). A collectable product is listed under “section 108-10 (2)” and it is used for the personal use and personal enjoyment by the tax payers. There are some examples of collectable such as, piece of art, antique, rate stamps, jewellery etc. as per “section 102-5 (1), ITAA 1997”.

    Helen bought the historical sculpture against an amount of $6000 which she sold at a price of $5000. In this deal Helen secured a capital gain. According to “section 102-5 (1), ITAA 1997”from the collectable items are taxable. 

    Point 3

    An important statement is mentioned there under “section 108-10 (1), ITAA 1977” that the capital losses from the collectables are isolated and it is only allowable to be counterpoise against the capital gains earned from the other collectables (Wolter Kluwer, 2019b). Helen bought the antique jewellery in 1987 at a cost of $14000. She sold it on 20th March 2018 and this deal results a capital loss. As per the stamen made by “section 108-10 (1), ITAA 1997”, Helen is only allowed to counterbalance this capital loss from the collectable with the capital gain from other collectables(Chardon,Freudenberg and Brimble 2016). 

    Point 4

    “Section 108-20, ITAA 1997” states that there are specific kinds of assets that are used for personal used separated from the collectable items which are mainly considered under the ownership of the taxpayer for their personal use (Wolter Kluwer, 2019c). It is very important to note that “section 118-10 (3) ITAA 1997” considers that the capital gains from the sale of personal assets which are purchased at a cost lower than $10,000 is overlooked (Wolter Kluwer, 2019c).

    The question states that Helen’s mother bought a picture on March 1987 at a price of $470. The picture was sold by Helen at a price $5000 and this sale created a capital gain for Helen. According to “Section 108-20, ITAA 1997”, this gain is avoided because the picture is an asset which is for personal use only and it was purchased lower than the cost $10,000. 

     

    Issues

    As per the “section 6 of the ITAA 1997”, receipts from the performance of contract or the service provisions are preserved as the income from the personal exertion. The amount of payment to the recipient is significant. This includes the link between the received amount and the activities of the taxpayer.  As per “Hayes v FCT (1956)” the amount which is received from the personal exertion is considered as the event or the product of employment for any types of services rendered. In “section 6-5, ITAA 1997”, all types of income by a person like allowances, compensations, gratuities and benefits  are considered for which he have provided service (Wolter Kluwer, 2019d). 

    According to “section 6 of the ITAA 1997”, the income which is taxable in nature is earned with the traditional concepts. This includes the rewards provided to any personal services or payments established for the services which were delivered as the cause of receiving payment (Wolter Kluwer, 2019e).

    “Brent v FC of T (1971)” explains the reason behind considering the payment as the product of income. In this case of “McCauley v FC of T (1944)” transmission of the copyright of the asset and accepting the payment from it is not considered as royalty (Wolter Kluwer, 2019f). Instead of that, the received amount is considered as ordinary income as per the ordinary concept of “section 6-5, ITAA 1997” (Wolter Kluwer, 2019g).

    Answer to question 2

    Issues

    As per the “section 6 of the ITAA 1997”, receipts from the performance of contract or the service provisions are preserved as the income from the personal exertion. The amount of payment to the recipient is significant. This includes the link between the received amount and the activities of the taxpayer.  As per “Hayes v FCT (1956)” the amount which is received from the personal exertion is considered as the event or the product of employment for any types of services rendered. In “section 6-5, ITAA 1997”, all types of income by a person like allowances, compensations, gratuities and benefits  are considered for which he have provided service (Wolter Kluwer, 2019d). 

    According to “section 6 of the ITAA 1997”, the income which is taxable in nature is earned with the traditional concepts. This includes the rewards provided to any personal services or payments established for the services which were delivered as the cause of receiving payment (Wolter Kluwer, 2019e).

    “Brent v FC of T (1971)” explains the reason behind considering the payment as the product of income. In this case of “McCauley v FC of T (1944)” transmission of the copyright of the asset and accepting the payment from it is not considered as royalty (Wolter Kluwer, 2019f). Instead of that, the received amount is considered as ordinary income as per the ordinary concept of “section 6-5, ITAA 1997” (Wolter Kluwer, 2019g).