Analyze and then advice abc of its fbt consequences

Assignment Help Taxation
Reference no: EM13874064 , Length: 2000 Words

Scenario-1: Topic: Fringe Benefit Tax

Alan is an employee at ABC Pty Ltd (ABC). He has negotiated the following remuneration package with ABC:

• Salary of $300,000;

• Payment of Alan's mobile phone bill ($220 per month, including GST). Alan is under a two-year contract whereby he is required to pay a fixed sum each month for unlimited usage of his phone. Alan uses the phone for work-related purposes only;

• Payment of Alan's children's school fees ($20,000 per year). The school fees are GST free.

ABC also provided Alan with the latest mobile phone handset, which cost $2,000 (including GST).

At the end of the year ABC hosted a dinner at a local Thai restaurant for all 20 employees and their partners. The total cost of the dinner was $6,600 including GST.


(a) Analyze and then advice ABC of its FBT consequences arising out of the above information, including calculation of any FBT liability, for the year ending 31 March 2015. Assume that ABC would be entitled to input tax credits in relation to any GST-inclusive acquisitions.

(b) How would your answer to (a) differ if ABC only had 5 employees?

Scenario-2: Topic: Residence and Sources

The Big Bang Company was set up by Ed, an Australian resident. It is incorporated in Singapore and has two directors who are resident in Singapore and who hold board meetings in Singapore. Each director has two shares in the Big Bang Company, which they hold on trust for Ed. The Big Bang Company owns real property, all of which is outside Australia, and makes its pro?ts from commercial property leases on a large scale. Ed does not attend the board meetings in Singapore; however, the constitution of the Big Bang Company provides that the decisions of the directors are only effective if Ed concurs with them. The directors carry on all operational activities, such as collecting rent, paying commission, ?nding tenants, making minor repairs and maintaining the buildings.


Is there any possible scenario in which the Big Bang Company could be considered a resident of Australia for tax purposes? Refer to Ruling TR 2004/15, justify your answer considering all the possibilities applicable in this scenario to become a resident of Australia. A detail analysis of each possibility is required.  

Word Limit: 2000

Verified Expert

Reference no: EM13874064

Discuss the effect on the assessable income of the parent

HA3042 TAXATION LAW TRIMESTER 2, 2016 INDIVIDUAL ASSIGNMENT. Your client is a parent who lent $40,000 to her son to provide a short-term housing loan. The agreement is that t

How do the tax laws ensure that the gains are deferred

Why does the tax code allow taxpayers to defer gains on like-kind exchanges? How do the tax laws ensure that the gains (or losses) are deferred and not per- manently exclude

Discuss the effect on the assessable income of the parent

HA3042 TAXATION LAW - Discuss whether or not the three payments are income from personal exertion. Would your answer differ if she wrote the story for her own satisfaction a

Conduct basic tax research and tax planning

Conduct basic tax research and tax planning on individual federal taxation issues and explain the issues for accounting periods and methods, tax computation methods, tax credi

What is the after-tax return on bills corporate bonds

What is the after-tax return on Bill's corporate bonds for the current year? What is the after-tax return on his municipal bonds for the current year? Which investment earns m

Federal income taxation of corporations and shareholders

Realty Corporation sells the building, subject to the mortgage, to Barbara in the current year for $600,000 in cash - Federal Income Taxation of Corporations and Shareholders

Teledex company manufactures products to customers

Teledex Company manufactures products to customers' specifications and operates a job- order costing system. Manufacturing overhead cost is applied to jobs on the basis of d

Describe how a taxpayer might assess the financial solvency

Describe how a taxpayer might assess the financial solvency and viability of a government using government-wide financial statements prepared according to generally accepted


Write a Review

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd