Block of Vacant Land

2500 shares of PHB iron Ore Ltd . Acquired in 2001 and sold in current tax year that is 2018 then it will considered as long term capital asset.

As the stamp duty will be considered as capital loss it will be added in the cost base.

Cost base = purchase price + stamp duty on purchase

As asset held for more than 12 months then we have to calculate indexed cost of acquisition

= 2500 * 12 = 30000

=

= 95230.04 will be indexed cost of acquisition.

Cost base = 45710.41 + 1500 = 47210.41

Sales consideration will be 2500 *25

= 62500

Brokerage fees will be deducted from the Sakes consideration

= 62500 – 1000

= 61500

Computation of capital gain:

PART 3

1200 shares of Young Kids Learning ltd. Acquired in 2005 and sold in current tax year that is 2018 then it will considered as long term capital asset.

As the stamp duty will be considered as capital loss it will be added in the cost base.

Cost base = purchase price + stamp duty on purchase

As asset held for more than 12 months then we have to calculate indexed cost of acquisition

= 1200 * 5 = 6000

=

= 8228.98 will be indexed cost of acquisition.

Cost base = 8228.98 + 500 = 8728.98

Sales consideration will be 1200 *0.50

= 600

Brokerage fees will be deducted from the Sakes consideration

= 600 – 100

= 500

Computation of capital gain:

PART 4

10000 Shares of share build ltd Acquired on 5^th July current year and sold in current tax year that is 2018 then it will considered as Short term capital asset.

As the stamp duty will be considered as capital loss it will be added in the cost base.

Cost base = purchase price + stamp duty on purchase

As asset held for less than 12 months, here we do not calculate indexation.

= 10000 * 1 = 10000

= 10000 plus stamp duty

= 10000 + 1100

=11100

Sales consideration will be 10000 *2.50

= 25000

Brokerage fees will be deducted from the Sakes consideration

= 25000 – 900

= 24100

Computation of capital gain:

Violin-As the client is not the trader in the violin but an investor then the violin represent his capital asset and not a stock in trade, as he sale of one of its violin, then the difference between the sale value and the cost of the asset would be chargeable as Short term capital gain.

As $ 1500 is a short term capital loss which can be Set off against both the short term capital gain or long term capital while on the other hand remaining 8500 – 1500 = 7000 is the long term capital loss which is brought forward from the previous year. This long term term capital loss will be set off only against the long term capital gain.

Total long term capital gain for current tax year:

= 147090.67 + 119175+ 22763.6 + 14289.59

= 303318.86

Total long term capital loss of current tax year:

= 1972.65 + 8228.98

= 10201.63

Total short term capital gain for the current tax year:

= 13000 + 6500

19500

First brought forward long term capital loss of $ 7000 will be set off against log term capital gain 303318.86 – 7000 = 296318.86

Then long term capital loss of current year will be set off:

= 296318.86 – 10201.63

= 286117.23

Then short term capital loss of the previous will be set off either from short term capital gain or from long term capital gain as per your choice.

= 19500 – 1500 = 18000

Net long term capital gain:

28117.23

Net short term capital gain :

18000

Total capital gain for the current tax year ended on 30^th June

= 28117.23 +18000

= 46117.23

Fringe benefit tax is tax payable by the Employers for benefits paid to the Employee in addition to the salary or the wages. This is Separate to the income tax and is calculated on the taxable value of fringe benefits provided.

Taxable value of the car Fringe benefits :

Taxable value = (A*B*C)/D-E

Where,

A = Base value of the car.

B= Statutory percentage applicable.

C= Number of days in the FBT year when the car was used or available for private use of Employees

D= Number of Days in the FBT year.

E= Employee Contribution.

Base value of the car = original cost price including GST

= $33000 including GST

Car will be considered as available for the private use where the car repair at the workshop for the routine service, In this case it is for 5 days .

Car will not be considered as private use where it is parked at airport in this case it is for 10 days.

Expenses of $ 550 will not be considered as it will reimbursed by the rapid Heat Pty ltd.

As the total kilometre travelled during the year is 11000 Kilometres which is less than 15000 kilometres.

Number of days in the FBT Year when the car was used for the private use of the Employees

= From 1^st May 2018 to 31^st March 2018

= 335 days

= 335days – 10 days

= 325 days

Statutory applicable Percentage :

11000 * 365/325

= 12354 Kilometres

As the 12354 kilometres is less than 15000 kilometres the applicable statutory percentage is 26%

Calculation of the taxable value:

= 33000 * 26% * 325/365

= Taxable value is 7639.72

Taxable value of the loan Fringe benefit is the difference between the Interest accrued during the FBT year and the statutory rate of interest will be applied to the daily outstanding balance of the loan and the interest actually received. GST does not affect the taxable value of the loan fringe benefits.

As the loan of $ 500000 is provided to the jasmine, the statutory interest is 5.65%

= Notional interest on the loan will be $500000 * 5.65%

= $ 28250

The actual interest would be = 500000 *4.25%

= 21250

The difference of 28250 – 21250

= 7000 will be taxable value of the loan fringe benefit tax.

Lent $ 50000 to husband at interest free to purchase the share of the Telstra. Husband shares in the dividend income of the shares is 50000 /500000 i.e is 10%

The otherwise deductible rule applies , but the taxable value can only be reduced by the employee (Jasmine share)In the Income producing asset

Jasmine share 100% - 10% = 90%

Taxable value multiply by Jasmine share

= 7000 * 90%

= 6300

As jasmine purchase the Electric heaters for $ 1300 which is less than amount of 2600 at which rapid hear sold to general public in outside market , then the taxable value will be

= 2600 – 1300

= 1300 is the taxable value

It is immaterial that is electric heater is manufacture at $700 because we compare the actual price with the market price .

Calculation of the total FBT Liability:

= 7369.72 + 7000 +1300

= 15669.72

Rapid heat set off the GST paid on the purchase of the car and the expenses incurred on the minor repairs with their Output sales GST.

Part b

If jasmine used $ 50000 to Purchase the shares herself instead of lending it to the husband.

Then no need to obtain where the loan:

• Used solely to enable the jasmine (employee) to purchase the shares in your company and employee owned the shares throughout the year to the period where the loan is outstanding.
• Providing the sale credit to the employee of services and goods exclusively used in employees employment there is an example for it protective cloth selling too employee on interest free credit terms.

YES In part b answer will differ as jasmine used $ 50000 to shares herself by adopting the above method.