Repairs

1. What is the difference between a repair and:

(a) a replacement;

(b) an improvement;

(c) an addition?

1. What test is used to determine whether something is an 'improvement'?

1. What is an 'initial repair'?

1. What is a 'pre-emptive' repair?

1. In what circumstances will a 'pre-emptive repair' be an allowable deduction?

1. What is a 'notional' repair?

1. In what circumstances with a notional repair be allowed as a deduction?

1. How might capital expenditure on income producing premises be deducted if the work cannot be categorised as a repair?

Bad Debts and Carry-forward Losses

1. What conditions must be satisfied before a taxpayer is permitted to deduct the amount of a bad debt?

1. Under what provisions are carry forward losses deductible?

1. What income do you offset your carry forward losses against - and in what order do you offset them against that income?

1. How long can you carry a loss forward and offset it against income you earn in later years?

Gifts

1. In what cases are gifts deductible?

1. What is the minimum amount of a gift that is deductible?

1. X makes a large donation to her son's school's building fund in lieu of paying school fees? Are donations to school building funds deductible? Is this donation deductible?

Pre-paid Expenses

1. Z prepays his photocopier maintenance contract paying $1000 in April 2013 for the next 2 years? What are the tax consequences?

1. What would the tax consequences be if he prepaid that amount but only for 12 months?

1. G borrows half a million dollars to buy a block of flats which he intends to rent out. The loan is for 10 years and he pays a loan establishment fee of $500. Can he deduct the loan establishment fee? How?

1. Would it make any difference if the loan establishment fee had been $100 instead of $500? Provide a reference.

Depreciation

1. Under what conditions can a taxpayer claim depreciation?

1. In the context of depreciation, define the term 'depreciating asset'.

1. What is the effect of the words 'installed ready for use' in s 40-60(2)?

1. Who is entitled to claim a deduction for depreciation?

1. How do you determine the appropriate rate at which a particular item of plant should be depreciated?

1. How do you calculate a depreciating asset's effective life?

1. How do you depreciate an asset that is only used partly for income producing purposes?

1. When can you get an immediate write-off for the full cost of a depreciating asset:
   1. if you are a small business taxpayer;
   2. generally?

1. What is the effect of allocating a low cost asset to a low-value pool?

1. What is a low cost asset for that purpose?

1. How do you calculate the cost of a depreciating asset?

1. What is the 'car limit' that applies to the first element of the cost of a car for depreciation purposes?

1. What is the difference between the diminishing value and the prime cost methods of depreciation?

1. What is the effect of using a depreciable asset for partly private and partly business purposes?

1. What are 'balancing adjustments' and when are they used?

1. What is the effect of balancing adjustments?

1. How do you calculate the balancing adjustment for an asset that was only used partly for income producing purposes?

1. If a deduction is possible under two or more sections of the ITAA 1936 and/or 1997, under which section or sections is it permitted?