BFA714: Depreciation Pool Balance - Australian Taxation Law - Law Assessment Answer

Internal Code: E_AI_DGCG_EI Subject Code: BFA714

Law Assessment Answer

TASK: Your client, Tom Lee runs small clothes shop in the suburb of Kingston, Hobart. He operates as a sole trader. The business is known as ‘Tom’s fashions’ and Tom Lee has an ABN and is also registered for GST. The following figures are exclusive of GST. Receipts $ 298,000                 Sales of clothes 17,000                   Rental income from an income producing investment apartment 1,000                     Interest on Bank deposits. 8,000                     Fully franked dividend from a large Australian public company 2,000                     Exempt income from part-time military service 2,000                     Private Health fund refunds 6,000                     Fifty-percent franked dividend received from a large Australian public company Payments $ 15,000                 Body Corporate fees on income producing property 25,000                 Part-time employee salary 2,000                   Superannuation contribution for employee 5,000                   Interest on money borrowed to purchase the income producing investment apartment 3,000                   Insurance and land tax for the investment property 1,100                   Fees paid to a registered Tax Agent 30,000                 New item of plant with an estimated life of 10 years 1,000                   Travel to and from work 2,000                   Rates on his principal residence 5,000                   Doctors fees for Tom Lee 3,000                   Doctors fees for Tom’s wife, Mary 6,000                   Superannuation contribution for Tom Lee (a) Tom Lee is using the Small Business Entity (SBE) concessions (b) Stock at beginning of the year was valued at $35,000 Stock at end was:   Cost   $16,000 Market selling value         $19,000 Replacement                     $18,000 (c) On 1 July 2018 the opening depreciation pool balance for the SBE pool was $40,000. During the year Tom Lee purchased 1 new depreciating assets used 100% for business purposes. This is recorded in the payment’s information listed above. The investment apartment was purchased new on 1 July 2018 and is part of a hotel complex. The real estate the agent advised Bill Jones that the construction cost of the apartment was $287,000 and this was confirmed by the builder. (d) Tom Lee has a carry forward tax loss from an earlier income year of $10,000. (e) Tom Lee and his family are members of a private health fund and do have private hospital insurance. REQUIRED Calculate Tom Lee’s personal tax liability for the year ended 30 June 2019. You should explain your treatment of each item in this question. Figures can be rounded to the nearest dollar.

This Law Assessment has been solved by our Law experts at onlineassignmentbank. Our Assignment Writing Experts are efficient to provide a fresh solution to this question. We are serving more than 10000+ Students in Australia, UK & US by helping them to score HD in their academics. Our Experts are well trained to follow all marking rubrics & referencing style.