ASSESSMENT BRIEF Subject Code and Title: XXXXXXXXXXLAW 6001 Taxation Law Assessment:- XXXXXXXXXXAssessment 2: Written Assignment Individual/Group:- XXXXXXXXXXIndividual Length:- XXXXXXXXXXMaximum 2500...

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ASSESSMENT BRIEF Subject Code and Title:- LAW 6001 Taxation Law Assessment:- Assessment 2: Written Assignment Individual/Group:- Individual Length:- Maximum 2500 words Learning Outcomes:- 2. Explain the Code of Conduct established under the Tax Agents Service Act (TASA) 2009. 3. Interpret and apply selected sections of the Income Tax Assessment Act (ITAA) 36 and ITAA 97. 4. Investigate alternatives and prepare written advice for a client about the tax implications for a proposed investment strategy. 6. Analyse and apply tax legislation to authentic scenarios. Submission By 11:55pm AEST/AEDT Sunday of Module 5 Weighting 30% Total Marks 100 marks Taxation 2 Assignment T3 2017 Question 1 (5 marks) With reference to the UK Australia Double Tax Agreement explain: a) the meaning of the term Permanent Establishment. b) how the business profits of an enterprise incorporated in the UK are taxed in Australia. c) whether contracts made through an independent agent would result in a Permanent Establishment Question 2 (10 marks) Andrew McSwington is a highly regarded MLB prospect. During the American off season he first travelled to Mexico to play in the Fall League for 2 months and then decides to come to Australia and play in the Australian Baseball League in December, January and February to play for the Adelaide Chomp. He signs the contract stipulating he is to be paid $45 000 for the 3 months in Adelaide and joins the team shortly after. The contract states he is to be paid monthly into a bank account in the Turks and Caicos Islands Andrew is impressed with Australia and decides to purchase a home unit at Glenelg. His plan is to use it as a base during the home and away series and rent it out for the remainder of the income year. Discuss with reference to relevant case law: · Whether Andrew is liable for taxation on the $45000 for his baseball skills · Whether Andrew is liable for tax on the rental income received during the balance of the year Question 3 (10 marks) Explain how the principle from the Myer Emporium v FCT case is used to determine whether a receipt is assessable as ordinary income or as a capital gain. Illustrate the principle with reference to relevant case law. Question 4 (15 marks) a) With reference toSoftwood Pulp and Paper v FCT 1976 explain whether a deduction is available for interest paid on a loan during the preparatory stages of a business. In your answer discuss when would a business advance from a preparatory stage. b) With reference to Ronpibon Tin NL v. Federal Commissioner of Taxation (1949) 78 CLR 47 explain the importance of the ‘incidental and relevant test” in determining whether interest paid on loans in deductible. c) With reference to FC of T v. Brown 99 ATC 4600; (1999) 43 ATR 1 explain whether interest paid on loans can be deductible after business activities have stopped Question 5 (10 marks) Explain with reference to the indicators of good tax policy whether you think the 50% general discount on capital gains for individuals is a good tax policy. Assignment Requirement Relevant case law:- In Q:-1 Need to be require first the below points · UK Australia double tax agreement (current one). · Permanent Establishment. · Independent agent. In Q:-2 Need to be require first the below points (A). · Discuss Residency · Apply Test · Refer to Applegate (B). Source of the income · Case law · Personal services · Mitcllum’s case In Q:-3 Need to be require first the below points · The Principle · Explain Myer Case Like Myer and West Field = at least one of each. · Substitution Principle of Myer Case · Once Off Gain can be income · Profit making intention (Entering the tax) · Two outcome income from Myer In Q:-4 Need to be require first the below points Preparatory Stages Deduction s8-1 = (+), (1), (-) Need to explain what is we need? (1) (2) (3) Business starts Active business Business stops Purpose of Producing Ass. Income (Assessable Income)