Question
You are to calculate the income tax payable/refundable for Betty for the 2018 income year based on the following information. You are to show all
You are to calculate the income tax payable/refundable for Betty for the 2018 income year based on the following information.
You are to show all workings out, including the use of indexation and discount methods where appropriate for comparison. CGT asset treatment needs to be fully explained for each asset.
Item 1:
Betty buys a block of land on 10 January 1992 for $100,000. The legal costs associated with the purchase amounted to $900.
She incurs the following expenditure on the land:
10 March 1992 Connection of services (water, electricity etc.) $3,000
20 February 1996 Construction of fences $3,500
10 Jan 92 to 10 Nov 17 Total municipal rates paid $12,650
She sells the land for $225,000 on 10 November 2017, incurring selling expenses of $1,960.
Item 2:
Betty also sells the following assets:
ITEM DATE OF COST DATE OF DISPOSAL
AQUISITION DISPOSAL PROCEEDS
(1)1972 Porsche car 15/4/99 $16,000 01/09/17 $125,600
(2)Principal residence 02/12/93 $112,000 01/10/17 $485,650
(3)ANZ shares 02/05/87 $1,000 10/12/17 $10,980
(4)Stamp collection 02/12/03 $16,000 10/04/18 $11,500
(5)Caravan 12/07/97 $16,500 01/05/18 $12,000
(6)Antique table 01/09/83 $1,800 03/06/18 $12,500
Other Income:
Gross wages from Australia (PAYG Withheld $13,400) $65,000
Gross Wages from China (Tax Withheld $4,000) $30,000
Interest Income $ 550
Fully Franked Dividend $ 200
Child Maintenance Payments $ 5,200
Deductions:
Deductions relating to Australian wages $ 1,500
Deductions relating to Chinese wages $ 500
Betty has adequate private health insurance
Step by Step Solution
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Income Tax Calculation Bettys taxable income for 2018 is 116950 Her tax payable is 1754250 which is ...Get Instant Access to Expert-Tailored Solutions
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