Jacky Oasis is a beauty consultant at Goodlook Ltd, and she owns 100% of the shares in this company. The company pays her a salary of $60,000 p.a. She has a long term relationship with John Kennedy and they plan to get married one day. John does not hold any shares in Goodlook Ltd. The Oasis Family Trust owns and leases commercial property. The trust is a complying trust and the beneficiaries are Jacky and her two sons. Three years ago, Jacky lent the trust $100,000 at 0% interest to finance the acquisition of a warehouse. The loan was to be repaid in 2017. However, the tenant of the warehouse subsequently went bankrupt and the trust is unable to meet its outgoings. In July 2018, Jacky decided to forgive the loan made to the trust.

1. Will the Oasis Family Trust be assessable on the $100,000 loan forgiven? Show all workings for your answer.

2. Can Jacky claim a deduction for the $100,000 loss? Show all workings for your answer