What you have to do

This assessment consists of 10 tasks. 

To achieve a satisfactory result in these topics you must achieve the following results for each task:

Task	Topics	Satisfactory/Not Satisfactory
1	Ethical considerations, conflict of interest and responsibilities of tax agents – code of professional conduct
2	Basics of the legal system
3	Assessable Income
4	Business Income and Trading Stock
5	Deductions of Salary and Wage Earner
6	Tax Free Threshold & Medicare Levy Surcharge
7	Motor Vehicle Expenses
8	Termination Payments
9	Capital Gains Tax
10	Uniform capital Allowances (Depreciation)
Result	Assessment result: Satisfactory (S) / Unsatisfactory (U)	-

Note: The number of rows and columns in the tables are indicative only. Students are allowed to add rows and columns according to their answers.

Task 1 – Ethical considerations, conflict of interest and responsibilities of tax agents – code of professional conduct

Required:

This task requires you to identify and follow legislative and regulatory requirements by critically evaluating and researching the relevant concepts.

1. What are the ethical considerations and correct course of conduct Mr Rafter should have adopted?
2. Did Mr Rafter contravene the provisions of the Code of Professional Conduct under the Tax Agent Services Act 2009 (TASA)?

Task 2 – Basics of the legal system

Required:

This task requires you to identify and follow legislative and regulatory requirements by critically evaluating and researching the relevant concepts.

1. Describe the three distinct powers of the government in the context of the separation of powers.
2. Describe the Treasury’s role in the development of Australian tax policy.
3. Describe the Tax Practitioners Board’s role in the tax system in Australia.
4. List the main Commonwealth Acts concerning the tax legislation.

Task 3 – Assessable Income

For each of the following items state what amounts (if any) are to be included as assessable income of William, an employee of Sports Stars Ltd.

Item	Information	Amount
A	Sports Starts Ltd. pays tuition fees of $3,000 for William’s children
B	$1,070 net interest from bank ($930 tax deducted due to no TFN notified)
C	Received an award of $600 cash as employee of the month
D	Carer payment of $1,000 received from Centrelink in respect of his 70 year old ill father
E	Given a farewell gift worth $120 from work colleagues of his previous employment
F	Tax refund of $3,400 received from the ATO
G	Reimbursement of hospital expenses from Medicare $700
H	Gross Salary of $71,000 ( PAYG $11,400)
I	Car allowance of $2,500 received from employer
J	Unfranked dividend of $4,000
K	Proceeds of term deposit of $5,200 (includes principal of $5,000)
L	Lottery win of $45,000
M	Army reserve payment of $850 to William who serves on part time basis
N	Received lump sum of $50,000 due to loss of  leg as a result of work accident
O	Prize of $200 won in a magazine competition
P	Birthday gift of $200 from uncle
Q	Gross interest on saving account held jointly with spouse $1,000
R	Christmas bonus of $800 received from Sports Stars Ltd
S	Fully franked dividend of $7,000 received from Westpac Bank
T	Received $2,400 from sickness and accident policy
U	Sports Starts Ltd. paid $1,000 in superannuation guarantee payments to William’s nominated superannuation fund
V	GST of $1,400 on sales received from customers on goods sold in his online business
W	Workers compensation of 2,000 received by William for lost wages

Task 4 – Business Income and Trading Stock

Calculate the Taxable Income of Peta Perfect under the accruals basis for the year ended 30 June 2018.

Task 5 – Deductions for salary and wage earner

Required:

1. Identify the amounts, which can be claimed as a deduction by the taxpayer.
2. Where the payment can be claimed as a deduction, identify a source document, which could substantiate the payment.

Item	$	$ Deductible Amount	Source Document
Luke is a salesperson and was fined for speeding while rushing to meet a customer.	500
Luke is a salesman and purchased a suit (which he wears when he goes to see customers)	350
Luke is a salesman and incurs costs for laundering his suit	90
Luke is a salesman who has incurred expenses in attending interviews for a new job (he wishes to leave his present job for one that pays more)	170
Tax agents fees to lodge objection against prior year tax assessment	450
Ian is a police officer who makes subscriptions to the police union	400
Ian is a police officer and makes personal superannuation contributions (concessional contributions) to a complying superannuation fund	2,800
Ian pays donations to public hospital	150
Sam is an ambulance officer who purchased Ambulance officer uniforms	300
Sam is an ambulance officer who incurred expenses for the laundry of Ambulance officer uniforms	150
GST remitted to the ATO	1,600
Michelle works as an accounts payable clerk and incurred expenses travelling from her home to work in her own car.	800
Michelle works as an accounts payable clerk and incurred parking fees for her own car when she parks in a parking station on the days she works back.	650
Michelle makes donations to Salvation Army (Registered Charity)	1

Task 6 – Tax Free Threshold & Medicare Levy Surcharge

Calculate the tax-free threshold for the following individuals for the year ended 30 June 2018. Use months rather than days in your calculations and show all your workings.

2017. Starr is single, aged 39 and became an Australian resident on 1 October 2017.

 

2017. Brendan is married, aged 42 and has no private health insurance. He ceased to be an Australian resident on 31 December 2017.

Calculate the Medicare levy surcharge for the following individuals for the year ended 30 June 2018.

2018. Murray is a single 42 year old. Murray received wages of $89,000, allowable deductions of $3,000, had reportable fringe benefits of $18,000 and a net investment loss of $4,000 for the year ended 30 June 2018.

 

1. d) Bella is single and has a taxable income of $110,000, reportable fringe benefits of $40,000 for the 2018 tax year.

Task 7 – Motor Vehicle Expenses

Show all methods of calculating the motor vehicle expenses and choose the most advantageous method for Daniel for the year ended 30 June 2018.

Task 8 – Termination Payments

1. Calculate the tax-free limit on the genuine redundancy payment.
2. Calculate the taxable component of the genuine redundancy part of the payment and indicate the applicable tax rate.
3. Calculate the remaining ETP cap amount.
4. Calculate the whole of income cap amount, determine the lesser of the caps, and indicate the amount.

Task 9 – Capital Gains

Required:

• Calculate the net capital gain for Christine for the year ended 30 June 2018 by using the CGT method that provides the best outcome for her.      

• Calculate the taxable income of Christine for the year ended 30 June 2018

 Task 10 – Depreciation

Required:

• Calculate the deduction for decline in value available to Liz in respect of the year ended 30 June 2018.            
• Calculate the value of the low value pool as at 30 June 2018.