TAXATION LAW

In grading both tasks, examiners will focus on your referencing to case law, appropriate sections of the ITAA 1936 and ITAA 1997 and income tax rulings issued by the Australian Taxation Office. A list of references used to answer all assignment tasks should be attached to the assignment.

Ronald Knight is an Australian resident taxpayer, is single and aged 34 years old. Ronald is employed full-time as a high school History teacher with the NSW Department of Education and has also recently purchased a rental property that he intends to rent to tenants in the near future. In relation to his 2021 income tax return, Ronald is unsure of the income tax implication for a number of receipts and payments throughout the year and is seeking your professional advice.

In the form of a letter of advice (directed to Ronald as your client) advise him of the income tax implications for the following receipts and payments relating to the year ended 30 June 2021. Calculation of taxable income is NOT required.

Payments 1. Purchase of a business suit $950 and annual dry-cleaning of the suit amounting to $270. While his employer does not require Ronald to wear a business suit while teaching he believes it is important to set an appropriate standard for his students. 2. Ronald recorded the following work-related travel in his private car:- 4520Km - travelling from his home to school to attend daily classes 298Km - travelling from his home to his school to attend after school parent/teacher meetings and student social events. 1250Km - travelling from the school direct to the local University where is employed as a part-time tutor by the University's School of Education. 3. $2,000 payment to a research firm to prepare a report regarding the demand for private tutoring in the local area. Ronald has not previously earned income from private tutoring but is contemplating commencing a private tutoring business in 2022. 4. Self-Education expenses - Ronald recently enrolled in a Bachelor of Commerce degree at the University of Newcastle and incurred the following costs:- - $4,710 Higher Education Loan Payments (HELP/HECS) $1,130 Text Books and Stationery On completion of his degree Ronald intends to switch to teaching Business Studies as he has identified that opportunities for promotion are greater for Business Studies teachers compared to History teachers. Payments 1. Purchase of a business suit $950 and annual dry-cleaning of the suit amounting to $270. While his employer does not require Ronald to wear a business suit while teaching he believes it is important to set an appropriate standard for his students. 2. Ronald recorded the following work-related travel in his private car:- 4520Km - travelling from his home to school to attend daily classes 298Km - travelling from his home to his school to attend after school parent/teacher meetings and student social events. 1250Km - travelling from the school direct to the local University where is employed as a part-time tutor by the University's School of Education. 3. $2,000 payment to a research firm to prepare a report regarding the demand for private tutoring in the local area. Ronald has not previously earned income from private tutoring but is contemplating commencing a private tutoring business in 2022. 4. Self-Education expenses - Ronald recently enrolled in a Bachelor of Commerce degree at the University of Newcastle and incurred the following costs:- - $4,710 Higher Education Loan Payments (HELP/HECS) $1,130 Text Books and Stationery On completion of his degree Ronald intends to switch to teaching Business Studies as he has identified that opportunities for promotion are greater for Business Studies teachers compared to History teachers