1.Daniel purchased a new rental property on 3 July 2013 and immediately rented it out earning $520 per week in rental income. He paid the following amounts in relation to the property:

Purchase price $400,000

Stamp duty on purchase $3,500

Legal fees to transfer title to him $1,300

Interest paid on loan to purchase the property $28,000

Loan establishment costs $700

Extension to main bedroom $14,000

Rates paid to the local council $1,500

What will be Daniels cost base of the rental property for CGT purposes based on the above expenditure?

a. $449,000

b. $447,500

c. $446,800

d. $418,800

e. $404,800

2. Which of the following is not a personal use asset?

a. A set of golf clubs used by an individual for their personal enjoyment.

b. A private home on one hectare of land.

c. An option to acquire a personal use asset.

d.A debt relating to a personal use asset.

e.A debt relating to a non-business transaction.

3. An adult resident beneficiary of a trust who is presently entitled to income of a trust is most likely to be assessed under which section of ITAA36?

Section 97(1)

Section 98(1)

Section 99(1)

Section 99A

Section 95(1)

4. The Jack and June partnership provides accounting services to the general public. The gross fees of the partnership were $210,000 in the year ended 30 June 2014. The partnership employs three people and paid them $30,000 each in salary for the year and in addition paid superannuation contributions of $2,250 for each of the employees into a complying superannuation fund. The partnership also paid $5,000 for each of the partners into a complying superannuation fund. Jack was paid a salary of $30,000 from the partnership while June was paid a salary of $35,000. Jack had drawings of $15,000 from the partnership during the year while June had $8,000. Jack had loaned $60,000 to the partnership for three years for use as working capital at 8% interest per annum and the partnership paid him $4,800 in interest during the year. The partnership had a net loss of $34,000 in the year ended 30 June 2013. Based on the above information, what is the net income of the partnership for the year ended 30 June 2014?

1. $113,250 2. $43,450 3. $98,450 4. $74,450 5. $108,450

5. In relation to the operation of s 263 ITAA36, which of the following statements is most

correct?

A. An ATO officer cannot enter a building or place belonging to a taxpayer unless they are authorised to do so.

B. An ATO officer cannot remain on the premises of the taxpayer unless they have a valid authority.

C. An ATO officer cannot enter or remain on the premises of the taxpayer if they have been requested by the taxpayer to produce a valid authority and fail to produce such an authority, and have been asked to leave the premises by the occupier.

D. A duly authorised ATO officer can have full and free access at all times to the taxation records of a taxpayer and can remove the records from the premises of the taxpayer to make copies without consulting the taxpayer.

E. A duly authorised ATO officer must state at the start of their investigations the exact documents and information that they wish to discover.

6. Which of the following is the most correct definition of a partnership for tax purposes?

A. An association of persons carrying on business as partners.

B. An association of persons in receipt of ordinary income or statutory income jointly.

C. An association of persons carrying on business as partners or in receipt of ordinary income or statutory income jointly, including a company.

D. An association of persons carrying on business as partners or in receipt of ordinary income or statutory income jointly, but does not include a company.

E. An association of persons carrying on business as partners or in receipt of ordinary income jointly, but does not include a company.

• 7. Lisa is 16 years old, attends high school full-time and has earned $7,800 from a part-time job during the year. She also earned $4,500 in interest income derived from investing $60,000 she received from her father as a gift. What will be her net tax payable for the year ended 30 June 2014 (apply Medicare levy and low income tax offset if applicable)?
• a. $3,510 b. $2,025 c. $5,535 d. $2,295 e. $2,337

8. The Hayden Family Trust is a discretionary trust with three individual resident beneficiaries. The following is a summary of the financial information necessary to calculate the net income of the trust for the year ended 30 June 2014:

• Rental income from renting out residential property of $230 000. Related allowable deductions were $76,000.
• Sale of a rental property on 14 May 2014 for $560 000 where the property was purchased on 5 June 2000 for $410,000.
• Cash dividends of $21,000 received from Australian resident companies. All dividends were fully franked.
• Interest income of $12,000 received during the year.

What is the net income of the trust for the year ended 30 June 2014?

a. $346,000 b. $271,000 c. $262,000 d.$337,000 e. Nil