QUESTION ONE Jim Lee and his wife Mary Lee are the two directors of the private company, Central Accounting Services Pty Ltd. On 1 July 2003 a Deed of Settlement was executed establishing the Central Accounting Services Trust The trust accounts for the consulting business for the year ending 30 June 2016 disclose the following Receipts Consulting receipts $524.000 Interest see note (iv) 1,800 Exempt income 40.000 Capital gain from the sale of shares in an Australian company - see note (V) 40.000 Dividend from BHP fully franked 16.540 Expenses Rent 40.000 Salaries to employees including 67.000 Purchase of a new photocopier with an effective life of 4 years 3.600 PAYG Withholding of $18,000 paid to ATO Salary to Jim Lee including PAYGW $23,000 90.000 Salary to Mary Lee including PAYGW $15,000 40,000 Payment of Jim's gambling debts 65.000 Superannuateon contributions for employees 5.674 Superannuateon contributions for Jim and Mary (50% each) 50.000 Notes - Additional Information - Central Accounting Services Trust (i) The Trust is a discretionary trust and Jim and Mary have as the trustees' full discretion as to how the net trust income will be distributed. (in) The trust is registered as a Small Business Entity (SBE) (iii) The Trust is registered for GST and all figures are exclusive of GST. (iv) Net interest of $1,800 from Singapore after withholding tax of $200 was withheld. (v) The trust purchased the shares in January 2013 and sold them on 31 May 2016. (vi) On 10 January 2016 one of the employees was robbed at gunpoint of the consulting receipts of $26,000 while on the way to the bank. (vii) In the income year ending 30 June 2015, the trust made a loss of $20,000 in respect of the consulting business