On 1 July 2005 Ben bought a rental property for $600,000.

Ben incurred the following expenses in relation to this property:

Legal Fees (incurred at purchase) $25,000

Stamp Duty $23,000

Agents Commission for selling the property $15,000

Legal Fees to defend his title over a portion of the garden $5,000

Required:

(a) Calculate the COST BASE of the property (3 marks)

(b) If Ben sold the property on 30 June 2020 for $925,000, calculate his NET CAPITAL GAIN (5 marks)

(c) Ben wants to know how his Net Capital Gain will be taxed. Explain the tax consequences and refer to law.