Australian Taxation

Capital Gains Tax Q2:

Janice Quick purchased land in 1973 for $500,000. On 20 September 1995, at a cost of $1 million, she commenced building a factory on which a deduction under ss 43-215 and 43-25(2) of Div 43 of ITAA 1997 (at 4% pa as an industrial building) is available and was available under the corresponding Div 10D of ITAA 1936 provisions.

Advise Quick of the income tax implications if the property was sold on 1 April during the current income year, and the amount of the sale price attributable to the factory building was variously:

Nil;

$400,000;

or $2 million.