1. According to the article by Tony Dimitriadis (see Supplementary Study Materials Folder), whether an amount received by a taxpayer following the sale of a capital asset (e.g. real estate) will be treated as capital or income depends largely on:

Select one:

The intention of the taxpayer when the property was first acquired

The degree of renovation and development carried out on the property

Whether the taxpayer held on to the property, rather than making a short term profit

Whether the taxpayer is an individual or a business taxpayer

All of the above are important considerations

2. Select the INCORRECT statement from the following options:

Select one:

The Cost Base of Personal Use Assets excludes Element 3 expenses (Ownership Costs)

An antique vase bought at a garage sale for $200 and sold for $20,000 is exempt from CGT

The indexation rate for assets acquired on 2 February 1986 was 41.4

All costs incurred under Element 3 (Ownership Costs) should be included in the indexation calculation

CGT discounting cannot create or contribute to a Net Capital Loss

3. Katie bought a block of land on 26 March 1995 for $120388 and sold it on 1 December 2018 for $500,000.

Calculate the Net Capital Gain on the sale of her land using the Indexation Method.