HI5028 TAXATION T2, 2014 ASSIGNMENT 2 SOLUTIONs
T2, 2014 ASSIGNMENT 2 SOLUTIONS
Attributable epoch: Friday Week 10
This enactment is to be submitted by the attributable epoch in twain softdelineation (Safeassign â€“ Bb) and stubborn delineation.
The enactment is to be submitted in correspondence with rebuke system normal in the Subject Extinguishedline and Learner
It is the matter of the learner submitting the is-sue to determine that the is-sue is in occurrence his/her hold is-sue. Determine that when incorporating the is-sues of others into your acquiescence that it unexceptionably unquestioned.
Maximum marks: 20 (20%)
Enactment 1: You should attack twain volume to this enactment Referablee: you should weld integral sections of the diverse Acts/regulations where misspend.
Part 1: Case study
Periwinkle Pty Ltd (Periwinkle) is a bathtub creator which sells bathtubs at-once to the open. On 1 May 2013, Periwinkle granted single of its employees, Emma, with a car as Emma does a doom of locomotive restraint is-sue purposes. However, Emma’s performance of the car is referable unpopular to is-sue solely. Periwinkle alienationd the car on that epoch restraint $33,000 (including GST).
Restraint the date 1 May 2013 to 31 March 2014, Emma travelled 10,000 kilometres in the car and incurred expenses of $550 (including GST) on junior repairs that bear been reimbursed by Periwinkle. The car was referable truthd restraint 10 days when Emma was interstate and the car was parked at the airport and restraint another five days when the car was scheduled restraint annual repairs.
On 1 September 2013, Periwinkle granted Emma with a mortgage of $500,000 at an attention rebuke of 4.45%. Emma truthd $450,000 of the mortgage to alienation a idleness settlement and lent the retaining $50,000 to her wife (attention munificent) to alienation shares in Telstra. Attention on a mortgage to alienation not attributable attributable-exoteric proceeds is referable deductible period attention on a mortgage to alienation proceeds-producing proceeds is deductible.
During the year, Emma alienationd a bathtub contrived by Periwinkle restraint $1300. The bathtub solely require Periwinkle $700 to molding and is sold to the open open restraint $2,600.
(a) Advise Periwinkle of its FBT consequences arising extinguished of the over notice, including investigation of any FBT impost, restraint the year end 31 March 2014. You may feign that Periwinkle would be entitled to input tribute credits in homogeneity to any GSTinclusive acquisitions.
(b) How would your counter-argument to (a) disagree if Emma truthd the $50,000 to alienation the shares herself, instead of lend it to her wife?
( 12 Marks) Part 2: Question
An excerpt of the asset register of Alpha Pty Ltd (â€˜Alphaâ€™) restraint the 2012-13 proceeds year is as follows:
Asset Require Opening
Appraise Method Effective
Life Decline in Appraise restraint
This Date Withdrawal
Computer 1,350 1,350 Diminishing
Appraise 3 years 450 900
Furniture 5,000 3,000 Prime Require 10 years 500 2,500
Cabinets 1,200 1,080 Prime Require 10 years 120 960
Integral depreciable proceeds are restraint 100% matter truth and Alpha truths a low-appraise pool restraint integral choice proceeds. The withdrawal appraise of the low-appraise pool at 30 June 2013 was $5,300. Alpha alienationd a printer on 5 June 2014 restraint $700.
Advise Alpha of the proceeds tribute consequences arising extinguished of the over notice restraint
the 2013-14 proceeds year. ( 8 Marks)