LAW 200187: Principles of Taxation Law - Mustafa Case Study - Law Assignment Help

Assignment Task:

Task: To advise your client of the tax implications of his activities and payments.  Your answer must include relevant cases, legislation and tax rulings. You must clearly reference your answers with footnotes. More on this referencing is found on the FAQ and in your Learning Guide.  

Refer to Principle of Taxation Law Learning Guide for details of Criteria and Standards for marking processes.  

Refer to Assignment FAQ for further information on the assignment including word limits, citation standards and ways to argue.  

NB: the FAQ together with the Learning Guide and this Assignment must be read in conjunction with one another.  Length: 1500 words 1 Value: 20% (20marks) Part A is worth 10 marks, Part B is worth 10 marks all parts and all questions compulsory.   

Part A    10 Marks

Mustafa is a taxpayer who is unsure of his tax situation and has come to you to seek your advice regarding the likely taxation implications of his personal affairs.  Mustafa asks if you can please prepare a report to advise him whether or not you think the activities listed would attract any form of assessment under the Income Tax Assessment Act.   Mustafa has asked that the advice be extensive and clearly state any possible tax related consequences. This advice is more than just whether amounts could be assessable, Mustafa has asked if you could consider tax planning and other considerations that could reduce any tax payable also.

Currently Mustafa receives a salary and usually also receives a performance bonus from his boss at the end of the financial year.   This bonus is connected to his performance at work and is calculated with reference to length of service and sales targets reached.

Mustafa has to travel a lot for work and is a member of the Qantas frequent flyer club and accumulates points in relation to work-related travel paid for by his employer.

In his spare time Mustafa works as a waiter and often receives tips from satisfied customers.  This is usually paid in cash and Mustafa simply puts it in his pocket and uses this money to live on for the week so that he is able to save as much of his salary as he can. 

Mustafa has been saving as much as possible and has decided to plan for his future.

He has undertaken a number of investment decisions and he is happy as he is doing well and the future looks bright.  However he just wants to ensure that he is aware of the taxation implications to assist in current and future planning decisions,

Mustafa currently receives interest from a term deposit.  This is invested in a fixed deposit with his bank with interest calculated daily and paid directly into his account monthly.

Mustafa has also commenced his property portfolio.   He purchased an investment property earlier this year that is currently rented to a stable tenant with a 6 month lease.  Mustafa is happy with this tenant and sees this investment as a long term arrangement since the Sydney property market is a little volatile at the present time.   Mustafa is receiving rent from the investment property one month in advance.

Mustafa is also a keen investor in shares and regularly invests in shares.  His approach is a mix of short term speculative investment and some longer term shares that he thinks will return more in the future.  These investments include business involved in artificial intelligence, technology companies involved in driverless cars and solar energy.  Mustafa is returning a profit from the sale of some shares and regularly receives dividend.

Mustafa has recently lost his grandmother to whom he was very close.  As a result he received a substantial amount of money under the will.

Mustafa also held a garage sale after his grandmother passed away as he did not have room for the items.  Mustafa grandmother had given these to him prior to her death as she wanted him to remember her. 

Mustafa likes to have the occasional bet on the football and he is quite a good pick.  At present he is doing well and is betting each week and coming out a winner. 

Mustafa was also a contestant on a television quiz show and won a cash prize.  Mustafa sees this as a possible future revenue stream as well as it is tax free and plans to enter these types of shows on a regular basis.

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