Residence and Source Case Study
The kit was born in Chile, so he has the Chilean citizenship. Australian taxation law considered him as a tax payer. The kit is an employee of Indonesia of United State. He spends most of the time working on the coast of Indonesia. He has a permanent house in Australia and planning for a permanent residential address in Australia. He was also an employee of Australia and his wife, and three children live there for last four years. According to the Australian taxation, law Kit was under tax consideration as an Australian citizen(Allison and Prentice, 2009). There is a joint account of Kit with his wife in an Australian bank where his payment of salary is made by the company where Kit was an employee. As per the taxation rule for the, all above factors Kit is entitled to the tax what is charged for him. There is one more evident which shows that kit has planned for residing in Australia that he has few investment and business settlements in Australia. Australian taxation law charged him under the tax as an Australian citizen.
The government of Australia gives the residential taxable persons very much importance. Before considering anyone under the taxation law, the taxation department should know about the eligibility of the taxpayer. The taxation department treats residential tax and the non-residential tax in a different way.
- Residential tax: These taxes are charged by the income of the charging person. If the person has any income from domestic purpose, that doesn’t have any effects on the tax of the person. If the person is a permanent citizen of Australia, then the person will be considered under the Australian residential tax (Bhimani and Horngren, 2008).
- Non-residential tax: These taxes charged by every sort of income of the taxpayer. The earning of different people the taxes are charged on them with the help of various kinds of taxation laws of Australia.
Taxes are collected by the government with the full support of the citizen of Australia. In fact, the total taxes are charged on their income, properties and their products. During the collection of the taxes, the government majorly follows three rules such as the state, the central and the local rules. A tax includes few special features like the compulsory payment of the tax, and the increment of the payment is only done by the government of Australia. The collection of the taxes also includes the service of costs. The tax payments are taken as a penalty from the citizen (Chen-Wishart, 2015). The taxation department of Australia has several intentions for the collection of the taxes. The taxes are saved for the development of the public. Taxes are collected by the public from their income and used for their betterment. Paying tax is a common trouble for the public; most of them refuse to pay taxes which can produce an economic problem in the whole economic sector. Through the paying can supports the market needs and the correction of the faults.
Australian Taxation Law and Tax Collection
So in the case of Kit to be a resident of Australia, he has to pay all taxes which are charged for him. The rate of resident tax is more than the rate of non-resident tax. The resident tax totally depends on the universal income. The interests’ rates from banks are normal which applies to Kit. So the capital gain tax is applicable for him (Duxbury, 2015).
The citizenship of a person can be verified, and the charged taxes are based on the following factors-
- A person will be considered as a resident if there are so many probabilities of the person to return to the country and live there permanently. So to be a resident of Australia the person will be charged for taxes according to the taxation laws.
- If any person has any investment or business deal in Australia, then the person will be known as a citizen of Australia and have to pay the tax bills (Engdahl, 2011).
- If the family of a person is permanently living in Australia, then the person will be considered as an Australian citizen.
- If any person is attended any trip with his family in Australia for a long time as more than a month, then the person will be able to achieve the citizenship of Australia.
- If the person is doing a job in any Australian company on a regular basis considered as a citizen of Australia and have to pay the tax.
- If a person is permanent lives in Australia, then he will be called acitizen of Australia.
- If a person has any bank account or any assets in Australia, he will apply to pay the tax.
- If any individual has migrated from another country to Australia and tried to establish a business in Australia then also treated as a citizen of Australia (Dauber, 2005).
The different factors consist of the residential tests can signify that if the person is the resident of Australia or not. If a person becomes successful in fulfilling all the principals to live more than six months in Australia in a permanent order, then the person will be treated as a citizen of the country.
In the case of kit, he has planned for permanent reside in the Australia and his family also the citizen of Australia from last four years. So he has also considered also a citizen of the country Australia. According to the taxation law of Australia, he is charged for tax and Kit is eligible for the tax which applies to him (Horngren, 2013). Kit has a personal interest in business deals in Australia and his wife and his three children also live in Australia. So the capital gain tax and the income tax apply to him which he has to pay.
The main reason for this case was a normal incident of a taxpayer’s business and profits in nature. The primary purpose or goal of the company was to get a land on the company’s hand which contained copper. The court took into custody that the profit generates by selling the land will profitable in future because the intention of the company was to make proceeds and profits by selling the property. The attempt made seemed to be showing the attempt which is being for showing that the land hold by the company is identified to be not for the longer period of time. After an extended period, the company sold the land or property to another company and expected shares of that company as deliberation (McMillan, 2010). The division of the profit is being made by the company in the various parts which includes the investment in the construction of the roads and the other infrastructures that are related to the property or the land.
Determining Residence under Taxation Law
As the mind made by the company is depicting that the land will not be sold, but the determinations made by the court is showing that the incomes earned must be taxed as per the laws are included. It only became conscious about the capital asset to its best advantage. After a few days time, the mind made by the company was regarding the selling of the business and also the copper was not taken out from the land by the company. For the purpose of having and appropriate share, the company sold the land to another company (MacIntyre, 2016). The case study simply shows that the profits are easily made by the company which became the income capital of the company. Therefore the enhancement of the income of the income is being made by showing various forms of the constructions as it is being made by showing the enhancement of the work.
The management of the land is being made by the shareholders by the help of the purchasing and also it aspires the taxpayer which must be subdivided for the purpose of selling the housing sites at a profit. In this case, the taxpayer was an association or a company which was built-in for the reason of obtaining an area of immature land at the Beach of Whit fords (Mott, 2008). The function of some non-commercial investment was the changing of the intention that had some purposes of rising. The court considers that at the time when some new shareholders obtained to manage the company. The land was beach frontage which developed by the company for the fishing purpose. The outcomes clearly shown by the court focuses on selling of the land for the purpose of being used practically. Therefore the attempt made is successfully executed as the addition of the returns is being made by showing the enhancement of the work and also the property purchased by the land seemed to be showing the appropriate construction of the roads or the processes with the other communication works involved (Tracy, 2013). Therefore the rejection of the tax will be creating a problematic situation which is being used by showing that the shares of the company were sold out.
The profits of the parkland afterward it was accustomed that of the commissioner. Such type of cases is specifically related to the income toll. The director easily accessed the tax and also the identification of the usage of the wrong method is being made by showing the appropriate facts represented for selling the land which was used for practical purposes (Oppermann, 2009). This case was connected to the expression of the situation where there is the lack of profit-making meaning in the event of profit-making intentions.
Ordinary Income Case Study
The income is depicted to be liable which rose due to the creation of the disagreement. This case was connected to the expression of the situation where there is the lack of profit-making meaning in the event of profit-making intentions. After the land is being sold, the person who is holding the land will have an appropriate profit after the land is being sold out (Ruff, 2014). The access made by the commissioner was showing the inappropriate adjustments and also was executed in a wrong way.
A sand company held its clutches on a land after extracting sand from it forms the crust of this case. The company took hold of the land and never intended to sell it until and unless the prices radically raised only to aid to increase in the return. The land was not being made to use in this issue and there was a hold by the company on the land by a really long time (Schroeder, Clark and Cathey, 2011). The land, however, was sold later and then another conflict was raised who was subjected to pay the taxes regarding the land. The court made a verdict that the land was intended to be sold only for commercial purposes and nothing else. Also, the future buyer of the land should only have the intention of using it for commercial purpose or else to someone who was related to the owner of the company.
In the following case, it is to be found out whether the farmer in question should be considered a taxpayer or not. As the farmer was in an attempt to buy a stretch of land, he faced difficulty as the land had some disputes in it (Lakshmanan, 2015). If he was subjected to any kind of taxes regarding the land was the question. In the end it was declared by the court that he need not pay any taxes and the land also was offered to him.
This case deals with the issue of a land that is owned by two brothers. The land also had a few houses that needed to be removed in order to renovate the land. The only question that arises in this issue is that whether the owners of the land, in this case, the two brothers, were liable to pay the taxes regarding the land (Ruppel, 2015). The court gave its verdict and in the end it was found that there was no need that the brothers would pay taxes regarding the land.
References
Allison, J. and Prentice, R. (2009). Business law. Austin, Tex.: University Co-Op.
Bhimani, A. and Horngren, C. (2008). Management and cost accounting. Harlow: Financial Times/Prentice Hall.
Chen-Wishart, M. (2015). Contract Law. Oxford: Oxford University press.
Dauber, N. (2005). Generally accepted auditing standards. Mason, OH: Texere.
Duxbury, R. (2015). Contract law. 1st ed. London: Sweet & Maxwell.
Engdahl, S. (2011). Taxation. Farmington Hills, MI: Greenhaven Press.
Horngren, C. (2013). Accounting. Frenchs Forest, N.S.W.: Pearson Australia.
Lakshmanan, J. (2015). Taxation laws. [Place of publication not identified]: Universal Law Publishing.
MacIntyre, E. (2016). Business Law. Pearson Education Limited.
McMillan, E. (2010). Not-for-profit accounting, tax, and reporting requirements. Hoboken, N.J.: Wiley.
Mott, G. (2008). Accounting fro Non-Accountants (7th Edition). London, GBR: Kogan Page, Limited.
Oppermann, H. (2009). Accounting standards. Lansdowne: Juta.
Ruff, A. (2014). Contract law. London: Sweet & Maxwell.
Ruppel, W. (2015). Wiley GAAP for Governments 2015. Chichester: Wiley.
Schroeder, R., Clark, M. and Cathey, J. (2011). Financial accounting theory and analysis. Hoboken, NJ: Wiley.
Tracy, J. (2013). Accounting for dummies. Hoboken, N.J.: Wiley.
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