Advising Client On Taxation And Tax Law In Australia

Fringe Benefits and Taxation in Australia

The relevant point that is provided by Airline Company does not come under the taxation ruling, which directly indicates that this type of benefit cannot be considered as a income. However, there are certain rules regarding the benefits provided by a company to its employees, which directly comes under fringe benefit tax. There are certain scenarios where the reward points could be considered under the fringe benefit tax. For instances if the reward points are received by the employee in form of benefits provided by the employer then it could be considered as taxable amount coming under fringe benefit tax. The second instance is mainly when the reward points are provided to the employee in a particular arrangement with its company. However, in the particular case there are no circumstances identified, which directly indicates that there will be no taxation on the reward points provided by the Airline Company. The Taxation Ruling 1999/6 is mainly states that fight reward received by employee from employer paid expenses is not considered under assessable income. The case related to Foster J of the Federal Court in Payne v. FC of T (1996) 66 FCR 299; 96 ATC 4407; (1996) 32 ATR 516 (Payne’s case) can be identified from the Tax ruling of 1999/6.

The overall case mainly depicts that damage payment has been conducted by the service receiver, which directly states that overall tax needs to be provided by service receiver. The damage that was conducted to the Capital Asset does not come under the taxable amount of the payment receiver. This directly indicates that the service receiver needs to pay the overall tax for the capital damage that is been conducted. However, there are some points that need to be considered before identifying the Asset to be taxed. That should be considered as a capital and needs to be utilised by the organisation thoroughly. In addition, the asset should also be depreciated under the depreciation clause and should be shown in the annual report. Thus, the compensation payment of crane is not considered under taxable income. The Taxation Ruling TR 95/35 mainly states the treatment of compensation receipts by companies for their assets. The ruling directly states that compensation received for damaged capital assets are not considered under assessable income of the individual.

The overall case mainly indicates that the there is relevant gift, which is provided by the supplier to the nightclub manager. However, according to the Australian taxation law for individuals, gifts of small kind is relevantly not considered, while big and expensive gifts are taken into consideration for the taxable income. In addition, the big gifts that could be converted into cash or amounts of high cash value could be considered under the taxable income of the receiver. Therefore, in the case scenario the manager of the nightclub has received the overall a package for the overseas holidays, which has relevant monetary benefits that is been received by the manager. This only indicates that individual taxation of the manger will include the overall overseas packages provided by the supplier. TD 2016/14 mainly depicts that overall no deductions are provided when individual provide gifts. 

Treatment of Compensations for Damaged Capital Assets

The overall scenario mainly indicates that extra funds were mainly collected from the members for the purchase of Canoe for the club. This mainly helped in understanding that individuals use the funds donated to Canoe club is not deductable under the taxation method. Thus, any returns provided from the club cannot be considered an additional income. The overall income for the individual members has already induced the overall funds that are paid to be club. Therefore, the overall individual’s income tax of the members will not reflect the returns of the money provided by the club as additional income and will be reflected as taxable income.

The overall case scenario mainly indicates that relevant payment is been conducted to a football player by a television company. According to the Taxation ruling in Australian TR 1999/17, it directly indicates that any sports person gaining income from individuals for its performance in sports needs to be considered under taxable income. This mainly indicates that the relevant income generated by the sports person from the television company will be considered, as the taxable income. Therefore, the individual taxation law indicates that relevant taxes needs to be paid by the footballer, as the money provided by the television company is directly considered as taxable income. The taxable income needs to be considered under the rulings TR 1999/17, where relevant taxes need to be paid by the footballer. Relevant measures are taken into consideration, where Income Tax Assessment Act 1936 (ITAA 1936) or the Income Tax Assessment Act 1997 (ITAA 1997) could be used. In addition, relevant section 6-5 of the Income Tax Assessment Act 1996 helps in deriving the ordinary income and detect the overall assemble income of an individual.

The overall scenario mainly indicates that expenses related to building qualification for a building apprentice is been conducted. According to TR 95/22 relevant consideration for the deduction of allowance to the employees of the construction company could be identified. This mainly indicates that relevant expenses conducted on the building apprentices is relevantly deducted for the construction company. Therefore, the overall expenses conducted by the construction could be used as deductible expenses, which directly reduce the overall taxable amount of the company. There are relevant sections, which could be seen under sections 25, 26AD, 27A, 27C, 27F and paragraphs 26(e) and 26(eaa) of the Income Tax Assessment Act 1936 (the Act). There are relevant abbreviations mentioned in TR 95/22, which are depicted as follows.

• The labours, trainees, carpenters, and apprentices used for building are mainly considered under the ruling.
• The overall supervisors work conducted for the building purpose and project manager’s work is considered under this ruling.

Therefore, the overall expenses conducted in the scenario mainly indicate that an expense conducted on the building apprentice is directly stated as compensation, which is deductible under the Taxation Ruling. The ruling also states whether the deduction is allowable or not with the help of under subsections 51(1), 51(4) or 51(6), or sections 51AB, 51AF, 51AGA, 51AH, 51AL, 53, 54, 55, 61 or 82A of the Act.

The relevant situation mainly indicates that relevant expenses are mainly conducted for a short course in art management in hope of becoming an art director. This directly indicates that overall expenses are mainly conducted to enhance the career of an individual, which under the taxation law of Australia is deductable from the taxable amount. However, there are certain criteria’s, which needs to be evaluated before identifying the expenses as deductable from taxable income. There are relevant criteria’s that need to be followed such as education module and software that is conducted by the individual needs to improve its income in future. In addition, short term fees course are mainly allowed as deduction, while other education facilities are ignored. The D4 work related expense directly states that relevant expenses of the course fees could be conducted for reducing the taxable income.

Taxation of Gifts and Income Received from Sportspeople

Therefore, the situation where the individual used a short term course to enhance its career and become the art director is considered under the deductions of taxation. Hence, the deductions could directly help in reducing the overall taxable income of the individual. Therefore, according to the D4 clause in ATO relevant expenses conducted by individual on courses, which is work related is mainly deductable in nature.

Situation many indicates that relevant expenses on makeup and dresses related to work are conducted by the individual. There is relevant taxation deduction for the expenses conducted on artist who is going to perform. These tax deductions are mainly limited to specified or subsequent individuals who are artists and can be provided the relevant exemptions. Performing artist mentioned in the taxation rule can be an actor, singer, variety artist, musician, circus performer, and dancer. Therefore, any kind of expenses that is conducted on the performing artist is allowed, as a deduction on the taxable amount. Hence, the expenses conducted on the makeup and dresses which work related are mainly deductible from taxable income. The performing artist clause mainly states that any kind of expenses, which is conducted for work related, is deductible in nature. Therefore, the expenses conducted on makeup and dresses are directly related to work expenses. The Taxation ruling of TR 93/30 directly states any kind of expenses, which is directly related to work is deductible in nature.

The situation many states in that overall expenses are been conducted by an individual travelling from home to work. This only indicates that relevant deductions could be possible under the taxation law, which travelling related to work activity could be deducted from the taxable amount. However, any kind of non official expense that is conducted on travelling cannot be identified, as the deductible expenses from the taxable income. Moreover, it is assumed that the expenses conducted on travelling from home to office are for official purposes, which is deductible in nature according to the Australian taxation law. However, on a different assumption if the expenses conducted on travelling are for personal use then it is not deductible according to the Australian taxation law. Therefore, determination of the expense is necessary for identifying the overall measure that could be conducted on taxable income. Under the ruling of D2 relevant work related travel expense are directly deductible in nature, which could help in reducing the overall assessable income of an individual. The Taxation ruling TR 95/34 mainly includes relevant employees carrying out itinerant work.

The scenario mainly states that overall expenses on travel are mainly conducted by the individual for office purposes. This overall expenses conducted on travel is mainly productively nature according to the Australian taxation law. The Australian taxation law directly states that any kind of expenses that is conducted for official purposes are deductible in nature, which could directly be used for reducing the taxable income. According to the scenario, overall expenses were mainly conducted from one workplace to another, which in the case could be used as a deduction amount for the taxable income. Therefore, the overall expenses can be deducted by the employer from its taxable income. The TR 95/34 mainly states that relevant expenses related to work is deductable in nature. However, the TR 95/34 is not linked in the situation, as the individual is not conducting work related expense.

The above table mainly helps in identifying the overall taxable income of Manpreet for the financial year of 2016-17. Only the residence of Australia needs to provide relevant taxes to the government, which will only be decided by using adequate residential method that helps in determining the need for taxation.  Manpreet as relevantly stayed in Australia for more than 6 month, which directly makes her resident of Australia, where relevant taxes needs to be paid. Manpreet also earns around $45,000 from its part time job, which directly ensures that she needs to pay the relevant individual tax. The assessable income can be identified from the overall table, which helps in identifying the relevant taxable income of Manpreet.

Manpreet has conducted different type of expenses for educational purposes, which does not indicate any kind of improvement in the income from part time job. Therefore, both educational expenses and computer expensive is not deductible from the taxable income. According to Section 8-1 of the Income Tax Assessment Act, domestic or private nature expenses are not deductible under this act. Hence, both the expenses conducted in computer and education is not deductible under the taxation law. However, any kind of expenses that is conducted to enhance the career or income of the individual is deductible under the taxation law. Relevant case laws such as Ronpibon Tin NL v. FC of T (1949), Lunney v. FC of T; Hayley v. FC of T (1958) 100 CLR 478; (1958) and FC of T v. M I Roberts 92 ATC 4787 could be used in supporting the Individual taxation law.

Reference

D2 Work-Related Travel Expenses 2017 (2017) Ato.gov.au <https://www.ato.gov.au/Individuals/Tax-Return/2017/Tax-return/Deduction-questions-D1-D10/D2-Work-related-travel-expenses-2017/?=redirected>

D4 Work-Related Self-Education Expenses 2017 (2017) Ato.gov.au <https://www.ato.gov.au/Individuals/Tax-Return/2017/Tax-return/Deduction-questions-D1-D10/D4-Work-related-self-education-expenses-2017/?=redirected>

Excess Contributions Tax Learner Guide (2017) Ato.gov.au https://www.ato.gov.au/Super/APRA-regulated-funds/In-detail/APRA-resources/Learner-guides/Excess-Contributions-Tax-learner-guide/?page=52

Individual Income Tax Rates (2017) Ato.gov.au <https://www.ato.gov.au/rates/individual-income-tax-rates/>

Legal Database (2017) Ato.gov.au <https://www.ato.gov.au/law/view/document?docid=TXR/TR19996/NAT/ATO/00001>

Legal Database (2017) Ato.gov.au <https://www.ato.gov.au/law/view/document?docid=TXR/TR9522/NAT/ATO/00001>

Legal Database (2017) Ato.gov.au <https://www.ato.gov.au/law/view/document?docid=PAC/19970038/8-1>

Legal Database (2017) Ato.gov.au https://www.ato.gov.au/law/view/document?DocID=TXR/TR9535/NAT/ATO/00001&PiT=99991231235958#P29

Legal Database (2017) Ato.gov.au https://www.ato.gov.au/law/view/document?DocID=TXR/TR199917/NAT/ATO/00001&PiT=99991231235958

Morgan, John, TD 2016/14 – A General Deduction Is Allowed For Gifts To Clients Of A Business (Query Whether It Be Aimed At Getting Future Income) (2017) Tax Technical https://taxtechnical.com.au/td-201614-a-general-deduction-is-allowed-for-gifts-to-clients-of-a-business-query-whether-it-be-aimed-at-getting-future-income/

Performing Artists 2017 (2017) Ato.gov.au <https://www.ato.gov.au/Forms/Performing-artists-2017/>

TR 95/34 – Income Tax: Employees Carrying Out Itinerant Work – Deductions, Allowances And Reimbursements For Transport Expenses (As At 29 November 2006) (2017) Law.ato.gov.au <https://law.ato.gov.au/atolaw/view.htm?docid=txr/tr9534/nat/ato/00001>

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