Exam 10: Taxation of Individuals

Lennie was a professional cricketer who, during his last game for the club, collected donations from the crowd for a meritorious performance in a game. Are these receipts likely to be assessable as income?

Patricia is 52 years old and she has owned and operated a small cafe bar for the last 6 years. She made a capital gain from selling this business of$600?000the 2019-20 tax year. Patricia also has a carry forward capital loss of $10,000. Assume that Patricia's business meets the basic conditions in Division 152 ITAA97 and so she qualifies for the CGT small business concessions. What is Patricia's net capital gain likely to be for 2020?

Babu is a bicycle courier who rides for a company called Crisis Couriers. Babu is required to wear a distinctive yellow uniform whilst riding for the courier company and is subject to various rules and regulations imposed by the courier company who also set his hourly rate. Crisis Couriers do not deduct any tax from payments to Babu nor do they provide any superannuation on behalf of Babu. In light of this information, which one of the following statements is likely to be true?

Sarah purchased a small flat in Sydney on 14 December 2014 for$520?000which she lived in until she was forced to move interstate in March 2018. Sarah lived in a rented apartment interstate and has not owned another property. Sarah returned to Sydney in March 2020 and then sold the flat in June 2020 for $750,000. Does Sarah have any CGT liability on the sale of her Sydney flat?

Sandra Livingstone who provides her personal training services through a company called "Get Fit Pty Ltd," has been unable to satisfy any of the Personal Services Income (PSI) tests to warrant exclusion from the PSI rules. The financial records of the company for the year ended 30 June 2020 indicate the following: Based on the above information, what amount of income will be attributed to Sandra in the year ended 30 June 2020?

Don owns a rental property and during the year ended 30 June 2020 he received gross rent of $14,040. From this gross rent, the property manager took out his fee of $1,404 and a leasing fee of $130 and paid, on behalf of Don, the council rates of $1,200. Don paid the water rates of $1,100 and undertook various minor repairs of $220 and also paid bank interest of $7,500. What is Don's net rental income for the year ended 30 June 2020?

Tim Rodgers, aged 64, is a resident and is married with children. Tim derived $85,000 in salary and received $5,300 in fully franked dividends during 2019-20 tax year. His deductions, which all relate to earning his salary, totalled $4,330. Tim's wife, Claire, who does not work and is in receipt of a disability support pension, had an adjusted taxable income of $7,200 (including the pension) for the 2019/20 tax year and was not entitled to, nor claimed, any family tax benefits. Tim has adequate private hospital health insurance cover. The tax paid during the 2019/20 tax year on Tim's salary totalled $19,172. Based on this information, calculate Tim Rodger's taxable income and tax payable/refund for the tax year ended 30 June 2020

On 1 November 2019 David Martin received a genuine redundancy payment of $64,000 from his employer RTZ Pty Ltd. David had commenced employment with RTZ Pty Ltd on 1 November 2012. Based on this information what are the tax implications for David in receiving the redundancy payment?

Sagar is a non-resident and during the 2020 tax year he derived $28,000 in wages from a part-time job in Australia from which $9,100 in PAYG withholding was deducted. He also received a fully franked dividend of $2,100 from an Australian company that had $900 in franking credits attached. Sagar incurred $290 in various work related expenses for which he has kept the required documentation and which are all fully deductible. What is Sagar's taxable income and will be receive a tax refund or have a balance of tax to pay?

Shane Edwards, is a resident individual who earned a gross salary of $25,000 and received a fully franked dividend of $10,500 for the year ended 30 June 2020. Shane's also had tax instalments (PAYG) deducted from his salary income of $6,000. Shane has no dependants and is not entitled to any dependant tax offsets/rebates. What is Shane's net tax payable/refundable (including Medicare levy if applicable but ignoring tax offsets) for the year ended 30 June 2020?

Anthony contributed $5,000 into his spouse's superannuation fund. His spouse's assessable income was $38,000. What is the amount of the low-income superannuation tax offset that Anthony may be entitled to for the 2020 tax year?

Harry is 56 and is under preservation age and has received a lump sum from his superannuation of $250,000. The lump sum was from an untaxed source. What rates of tax will apply to this lump sum?

Christine is a 45-year-old single woman. For the 2019-20 tax year, Christine's taxable income was$110?000, and she had reportable fringe benefits of$30?000. Christine did not have private patient hospital cover at any time throughout the year. What is Christine's Medicare levy surcharge liability?

Domenic is a practising lawyer and he recently completed his law degree and his outstanding HELP debt as at 29 June 2020 (before the 2020 tax return is assessed) is $14,800. Domenic's taxable income for the 2020 year was $121,000. Domenic also has a reportable fringe benefit amount of $12,000. What amount of HELP repayment will Domenic have to make in the 2020 tax return?

Sanjiv is a resident and works full time in an office as an administrator. On weekends from April 2020 he began using his own car as a ride-share operator with Guber. Sanjiv has come to you for tax advice as he thinks his income from Guber is not taxable as he enjoys driving and to him the activity is a hobby. What would you advise him?

Robert is a resident and during the 2020 tax year he derived $86,000 in salary from which $25,800 in PAYG withholding was deducted. He also received $400 in bank interest and he also received a fully franked dividend of $2,100 that had $900 in franking credits attached. Robert incurred $3,400 in various work related expenses for which he has kept the required documentation and which are all fully deductible. Robert also has a HELP debt of $10,200. What is Robert's taxable income and will be receive a tax refund or have a balance of tax to pay?

Eddie is single and a resident and his taxable income for the 2020 tax year is $26,000. What amount of Medicare levy will Eddie pay in the year ended 30 June 2020?

Byron, a resident of Australia, received a partially franked dividend, franked to 80%, for $1,400 from CBC Bank and a partially franked dividend, franked to 40%, for $1,360 from Sea Worths Ltd in the last tax year. What is the amount of the franking tax offset that Byron is entitled to?

Meg Ryan is paid a superannuation lump sum of $80,000 on 30 June 2020. Prior to being paid the benefit, the value of Meg's superannuation interest in the fund is $350,000, made up of $70,000 tax free component and $280,000 taxable component. Based on this information what part of Meg's lump sum would constitute the taxable component?

Johnathan is a resident and during the 2020 tax year he derived $62,000 in salary from which $13,000 in PAYG withholding was deducted. He also received $1,100 in bank interest and he also received a fully franked dividend of $700 that had $300 in franking credits attached. Johnathan incurred $2,100 in various work related expenses for which he has kept the required documentation and which are all fully deductible. What is Johnathan's taxable income and will be receive a tax refund or have a balance of tax to pay?