TAXATION LAW
TAXATION LAW 200187 AUTUMN 2018 TAKE-HOME EXAM Due Date: Monday 7 Might 2018, 17:00 Hours Evaluation Worth: 20% Phrase Size: 1500 phrases Evaluation Standards: See Studying Information IMPORTANT NOTES: 1) The examination consists of two (2) questions. 2) College students are required to try all questions. three) An examination exceeding the prescribed phrase size will incur penalties (viz., deduction of marks for extreme size). See Studying Information four) All solutions have to be supported with references to related laws, caselaw and/or tax rulings 5) The examination have to be submitted by way of Turnitin (see Studying Information for directions on learn how to submit) 6) College students ought to observe that this evaluation is an examination and due to this fact no late submissions will be accepted. 7) College students who don't submit by the due date and time are required to lodge a particular consideration utility to use for a deferred mid-semester examination. Additional particulars on vUWS. eight) College students who don't submit both a mid-semester examination on time nor lodge a profitable particular consideration are liable to a FNS grade for the unit even when they obtain an general mark of greater than 50%. QUESTION 1 – Ideas and Ideas (10 Marks) Renovations Pty Ltd (“RPL”) has been within the enterprise of residence renovation for over 30 years. Following a downturn within the renovations market nonetheless, RPL sought out new sources of earnings. In 2012, RPL determined to buy previous run-down homes within the inner-city, renovate them and lease them out for very excessive rents. After a while, the administrators of RPL determined that the corporate ought to once more consider its core enterprise exercise. Consequently, within the present tax 12 months (2017/2018) RPL bought the homes it had renovated for rental and made massive income. Just about laws and case legislation, advise RPL on the tax implications concerning the income it made throughout the 2017/2018 tax 12 months. You aren't required to undertake any capital positive factors calculations, the main focus of this query is earnings rules and ideas solely. QUESTION 2 – FBT Calculation Query (10 Marks) Jack is the state gross sales consultant for Quantum Vaccum Cleaners Pty Ltd (“QVC”), a provider and retailer of vacuum cleaners. On 1 October 2017, QVC equipped Jack with a automotive valued at $65,000 for work which was garaged at Jack’s residence on the weekends. Additionally on 1 December 2017, QVC loaned Jack $10,000 at 2% curiosity pa and supplied him with a vacuum cleaner which retails for $2,000, a automotive air freshner valued at $75 to assist preserve the automotive smelling recent. Jack used the cash to pay for repairs to his funding property. By 31 March 2018, Jack had travelled a complete of 12,700 kms within the automotive, with 3000 kms being for personal use on weekends. QVC pays $20,000 a 12 months in lease funds in respect of the automotive and has to this point paid $four,000 for upkeep and repairs and $three,500 for registration and insurance coverage in relation to the automotive it supplied Jack. Jack has paid $5,000 in gas bills. Jack retains all invoices, receipts and odometer readings. QVC is not sure how the above shall be handled for taxation functions and has come to you for recommendation. Required: By reference to laws and related case legislation (if any), calculate the entire tax legal responsibility arising from the above transactions.