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PART A Jack Brown, a resident of the Republic, has been achieving a reasonable return from the letting of a block of 15 flats that
PART A Jack Brown, a resident of the Republic, has been achieving a reasonable return from the letting of a block of 15 flats that he purchased in 1993. He does not have a history of property dealing. Jack is aware that he can make a substantial profit by selling the 15 flats individually. He has made application for a sectional title register to be opened. To make the flats more attractive to would would-be purchasers, Jack is considering improving them. Required: Discuss with reasons whether Jack Brown's receipt or accrual from the sale of the flats is of a revenue nature. Deal with the position when the flats are sold individually without improvements being made to them, and the position when the flats are first improved, and then sold. (40 marks)
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