Questions 1 - 6 Instructions: With reference to each of the situations below, outline the Capital Gains Tax consequences of the transactions. Refer to legislation, case law and/or principles of tax law in your response. 1. Marianne purchased an asset on 1 June 2008 for $50,000 and on 29 June 2018 the asset is destroyed by re. What are the capital gains tax consequences of the re in relation to the asset that was destroyed? (5 marks) 2. On 1 June 2018 Jane grants Ashleigh the option to purchase her beach house in Byron Bay. Ashleigh pays $2,000 for the option. Explain the specic capital gains tax event that relates to the above situation. (5 marks) 3. Paula owns a boat that her neighbour, Ethan, is interested in buying but Ethan wants to try out the boat rst. Paula agrees to hire the boat to Ethan and the agreement provides that Ethan will buy the boat at the end of three years unless Ethan decides to buy the boat sooner. Outline the capital gains tax consequences of this agreement. (5 marks) 4. Steven purchased a property on 1 July 2012 in Sydney. He immediately moved in and established it as his main residence. He moved abroad for 2 years on a work contract on 30 June 2014. The property was rented out from 1 July 2014 to 30 June 2016. When his contract was nished Steven moved back into his house in Sydney. Explain how the main residence exemption applies to this situation. (5 marks) 5. What are the capital proceeds for capital gains tax purposes if Mary-Anne were to gi an apartment with a market value of $2 85,000 to Michael? (5 marks) 6. Jordan is a boat builder and owns his own business, building exclusive yachts. He is building himself a yacht and took some building materials costing $5,000 for his own use. The materials could have been sold for $6,250. State what amount, if any, is assessable in respect of the above. (5 marks) 7. Question 7 What is the tax formula for calculating your tax liability every income year? Write the formula out in ill. Explain each element of the tax formula with reference to the relevant provisions of the ITAA97. (5 marks) 8. Question 8 Li earned a salary of $75,000 for the year ended 30 June 2019. She also received additional income and paid expenses as follows: Net rental income of $9,000 Capital losses on sale of shares $8,000 Bank charges of $150 on her investment account Tax agent's fees of $500 Purchase of a rafe ticket for $100 from the Royal Children's Hospital. The prize was a motor vehicle