Background
The issues relating to the study has been seen in terms of whether the cost involved for moving the machine to the new site shall be considered for non-allowable or allowable deductions.
- “Section 8-1 of the ITAA 1997”
- “Britissh Insulated & Helsby Cables”
- “Taxation ruling of TD 92/126”
Individual taxpayers shall be entitled for deductions in case the expenditure has been seen to take place for the purpose of assessable income. As per “Section 8-1 of the ITAA” the different expenses relating to moving the machine is seen to represent an additional increase in the acid cost. Based on the present context it has been discerned that the cost of moving the machine in the new site shall be not entitled for the purpose of allowable deductions. The sole reason for this is due to the fact that these non-allowable entitlements need to an increase in the cost of asset (Barkoczy 2016).
As signified in “British Insulated & Helsby Cables” the cost involved in the transportation signifies that there is a persistent benefit for the business by allocating the depreciable asset in a new location. As defined in “Taxation ruling of TD 92/126”, installation of the machine and starting of the business process is viewed as a part of the revenue. Henceforth, it can be suggested that the expense incurred in carrying the machine to the new site location shall be treated as per cost of capital and not be entitled under allowable portion of deductions (Datt et al. 2017).
Conclusion:
The consideration of the above explanation shows that the cost in moving the machine is not entitled for the total allowable deductions from the time such costs are seen to be portraying an outlay of the capital.
The main issue as per the present case has been subjected to the main concern whether the revaluation of the asset expense with the effect of insurance cover shall be entitled with “Section 8-1 of the ITAA 1997” for the purpose of allowable deductions.
- “Section 8-1 of ITAA 1997”
As for the given situation it can be clearly seen that the cost has taken place as a result of revaluation of the assets for insurance cover which needs to be considered for allowable deductions. With reference to “Section 8-1 of the ITAA 1997”, it has been discerned that the expense needs to be treated under allowable deductions as it has outlaid the features which are repetitive in nature. The outlay considered for asset evaluation is for the thing to be done on a straight-line basis which is related to the assets which are fixed (Saad 2014). The consideration of taxable return has been obligated to be determined for nature of deductibility of expenditure and evaluate whether it can be considered during the evaluation stage due to increase in the revenue generated from the activity or precaution of the asset. As evident with the cost, the impermanent nature of advantage and aspects of repetitive nature needs to be entitled for the deductions under “Section 8-1 of the ITAA 1997” (Deutsch 2014).
Advertising expenditure and input tax credits
Conclusion:
As inferred from the above explanation it can be said that the outlay encoding the devaluation of asset is to be entitled for deductions as per “Section 8-1 of the ITAA 1997” with the main reason being the nature of repetitiveness.
based on the current situation the main question has been raised whether the legal expenditure incurred by an individual taxpayer for the purpose of opposing the petition winding up needs to be considered for allowable deductions.
- “FC of T v Snowden and Wilson Pty Ltd (1958)”
- “Section 8-1 of the ITAA 1997”
As per the given case study can be discerned that any winding up of business activity needs to be normally treated under the outlay of the business functions and shall not be regarded as entitlement for the allowable deductions under “Section 8-1 of the ITAA 1997”. As stated under the “Taxation ruling of ID 2004/367” the main cost of carrying out of business operations needs to be considered for allowable deductions. The main rationale for this is due to the expenses which are delectable in nature as the cost is incurred by the taxpayer for producing the visible income (Millar 2014).
With reference to the case “FC of T v Snowden and Wilson Pty Ltd (1958)”, the expense or the whole place are seen to be arising from ordinary course and the individual taxpayer is required to held admissible for the allowable deductions.
The various types of legal expenses with the present context for opposing the winding of the edition shall not be entitled for admissible deductions. Despite of the various types of expenses which have been qualified and that the positive limbs, it shall not be considered for allowable deductions as it is deep-rooted within the business structure. Various incidence of the legal cost shall not be treated for admissible deductions as it is owned by the features of capital (Fry 2017).
Conclusion:
as per the denoted assessments it can be inferred that the various types of cost for opposing the petition for winding up of business needs to be barred from allowable deductions as it owns the attributes of capital under “Section 8-1 of the ITAA 1997”.
The most significant issue has been held in consideration with whether expenses of the services of solicitor for the business needs to be considered as for the deductions under “Section 8-1 of the ITAA 1997”.
- “Section 8-1 of the ITAA 1997”
As for the aforementioned ruling the legal expenditure associated to the trading activities needs to be considered for admissible deductions. It has been further seen to be worth noting that for the purpose of meeting the criteria of the legal expenditure trading activities shall be directly linked to produce higher revenue. As per the rulings of “Section 8-1 of the ITAA 1997” in case the various types of legal outlay seen to be of personal, capital and domestic in nature then it cannot be regarded as a non-exemption, non-admissible and non-assessable deductions. With relevance to the present issue, the individual taxpayers who are seen to be incurring the legal expense, the solicitor responsible for discharging the business functions needs to be treated as an exemption of the expenses as the individual will qualify for the allowable deductions as per “Section 8-1 of the ITAA 1997”.
Foreign tax offset calculation
Conclusion:
Based on the conduction of interpretations of legal expenditure, various services of the solicitor for discharging of business functions needs to be taken into consideration as per the rulings of allowable deductions as stated under “Section 8-1 of the ITAA 1997”. The main rationale for this is that the legal expenditure is considered as a liability reduction as it has been incurred with the revenue generating activities.
The main form of existing issue has been seen in terms of data mining the input tax credit associated to the GST supplies which has been made under “GST Act 1999”.
- “Ronpibon Tin NL v FC of T”
- “Goods and Service Taxation Ruling of GSTR 2006/3”
- “GST Act 1999”
Based on the given case of the Big Bank is seen to be concerned for the determination of GST supplies based on input tax credit as for the advertisement expenses. It is for the noting that the second chapter of “GST Act 1999” has been able to provide vital consideration for commercial units which needs to be permitted for claimed input tax incurred by the organisation as for normal course of business operations. Despite of this, the claiming process of input tax must be considered by adding of the GST amount. The given case study of Big Bank Ltd has been able to bring about the various types of financial services put forward to the customers in more than 50 branches in the country. Big Bank has been further able to bring about the services associated to program of insurance and home content into the market aside from providing various types of facilities of deposits and loans to its customers. With reference to “Taxation Ruling of GSTR 2006/3” important rules and regulations laid down in the process of tax computation has been observed (May 2016).
As per “division 11-15 and 129 of the GST Act 1999” the total creditable amount for acquisition and imposition for the ruling has been previously mentioned. As per the taxation rulings of “GSTR 2006/3” in organisation has exceeded the financial invitation for acquisition in the purview of lower input tax credit.
It has been further evident from the case study of Big Bank Ltd that the organisation has incurred its expenses based on the advertising and which is inclusive of the “Goods and Service Tax”. As per the present issues brought forward by Big Bank Ltd it can be clearly stated that the main rulings under “GSTR 2006/3” is applicable for the given situation. The main reason for GST application is seen with “GSTR 2006/3” as Big Bank has been able to successfully qualify self for tax credit claiming input. Based on the principle as per “GSTR 2006/3”, it is in discern that in case a commercial concern is registered under the ruling of “GST Act 1999”, or it needs to get the registration, can be stated that such an concern needs to make payment of GST with the amount of financial supplies available.
Calculation of partnership’s net income for the income year
The total GST rulings as per “GSTR 2006/3” has been able to state that the various types of commercial entities are able to claim for the input tax credit associated to supplies of financial assistance including the GST amount. On the contrary, in case the commercial entities goes beyond the financial acquisition limit then in such a case the taxable entity will not be permitted to claim for the full amount of input tax credit. However, it will be eligible for claiming of only a portion of the same.
As per the case denoted under the ruling of “Ronpibon Tin NL v FC of T” the most significant feature of GST ruling of “GSTR 2006/3” has been determined in terms of “extent” and “to the extent” for the total GST supplies made. As per this legislation, that is meant of GST as the based on responsibility and fairness of the commercial entities. As noted in the “para 11-5 and 15-5” the various types of GST rulings for “GSTR 2006/3” has been based on a commercial entity and the financial acquisition is as been able to qualify for the purpose of creditable acquisitions which has been made partially or fully (Coleman and Sadiq 2013) .
As a significant issue with respect to “para 11-5 and 15-5” of the GST rulings as per “GSTR 2006/3” has been able to qualify for the creditable acquisition. On the contrary, on assessing the acquisition which is partly eligible for creditable purpose, the degree of creditable purpose needs to be ascertained.
It has been further discern that as per “Section 11-5 and 15-10”, the appropriate GST legislation of “GSTR 2006/3” will be levied on the various types of financial supplies which has been made in the commercial entity inclusive of the sum of input tax and the tax which is to be claimed (Cassidy 2017). It has been further evident with Big Bank Ltd that the financial supplies are associated to the various types of creditable supplies. By consideration of the present indications with Big Bank Ltd the GST ruling of “GSTR 2006/3” has exceeded its limit of the financial acquisition and henceforth the concern needs to bring forward the input claim for tax credit on the sum of GST supplies (Cao et al. 2015).
Conclusion:
Based on the aforementioned discussions it can be inferred that “GSTR 2006/3” is mainly applicable for Big Bank Ltd as it has been able to qualify for the input tax credit based on advertising expenditure.
Computation of Taxable Income of Angelo
Assessment of net income pertaining to partnership
Reference List
Barkoczy, S., 2016. Foundations of Taxation Law 2016. OUP Catalogue.
Cao, L., Hosking, A., Kouparitsas, M., Mullaly, D., Rimmer, X., Shi, Q., Stark, W. and Wende, S., 2015. Understanding the economy-wide efficiency and incidence of major Australian taxes. Treasury WP, 1.
Cassidy, J., 2017, January. A GST with GRRRRRR: Legislative responses to GST tax avoidance in Australia and New Zealand. In Australasian Tax Teachers Association Conference 2017.
Coleman, C. and Sadiq, K. (n.d.). 2013 Principles of taxation law.
Datt, K., Nienaber, G. and Tran-Nam, B., 2017. GST/VAT general anti-avoidance approaches: Some preliminary findings from a comparative study of Australia and South Africa. In Australian Tax Forum (Vol. 32, No. 2, p. 377). Tax Institute.
Deutsch, R.L., 2014. Australian Tax Handbook 2006.
Fry, M., 2017. Australian taxation of offshore hubs: an examination of the law on the ability of Australia to tax economic activity in offshore hubs and the position of the Australian Taxation Office. The APPEA Journal, 57(1), pp.49-63.
May, S., 2016. Applying the GST to imported digital products and services: Problems and solutions. Tax Specialist, 19(3), p.110.
Millar, R., 2014. Grappling with basic VAT concepts in the Australian GST: the meaning of ‘supply for consideration’. World Journal of VAT/GST Law, 3(1), pp.1-31.
Saad, N., 2014. Tax knowledge, tax complexity and tax compliance: Taxpayers’ view. Procedia-Social and Behavioral Sciences, 109, pp.1069-1075.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
