Krafty Kitchens Ltd is a large kitchen manufacturer that is registered for GST purposes. It accounts for GST on an accruals basis and submits its BASs monthly. Krafty Kitchens Ltd organises and pays for the golf club membership of its Head of Sales, Samuel. This is treated as a fringe benefit for fringe benefits tax purposes.

On 16 April, Krafty Kitchens Ltd received a tax invoice from Samuel's golf club, Greenvale Golf Club, for the payment of Samuel's membership fees of $220 (including GST). Krafty Kitchens did not pay the membership fee for Samuel until 2 July, due to an oversight by the company's accounts clerk.

Greenvale Golf Club accounts for GST on a cash basis and submits its BASs quarterly.

You are required to:

a. Discuss the Income Tax implications of the events. Show all calculations. Your answer must

reference relevant sections of the Income Tax Assessment Acts.

b. Briefly discuss the GST implications of the events. Show all calculations. Provide reasons for

your answer.