Question 1 (5 Marks)
Fred, an executive of a British corporation specialising in
management consultancy, comes to Australia to set up a branch of
his company. Although the length of his stay is not certain, he
leases a residence in Melbourne for 12 months. His wife
accompanies him on the trip but his teenage sons, having just
commenced college, stay in London. Fred rents out the family home.
Apart from the absence of his children, Fred’s daily behaviour is
relatively similar to his behaviour before entering Australia. As well
as the rent on the UK property, Fred earns interest from
investments he has in France. Because of ill health Fred returns to
the UK 11 months after arriving in Australia.
Discuss whether Fred is a resident of Australia for taxation
note:we have to mention 4 case study similar to the previews one. explain few sentences about every case and how its relate to the main one.
Question 2 (5 marks)
Explain why the receipts in Egerton-Warburton & Ors v DFC of T
(1934) 51 CLR 568 were assessable, but the receipts in IRC v
Ramsay (1935) 1 All ER 847 were treated as capital amounts.
note: 1/3 page why we are assessable, 1/3 page why we are not assessable, 1/3 page our opinion.
Question 2 (10 Marks)
Angelina is married to Bradley. They each have two houses: ‘house
A’ and ‘house B’. Angelina and Bradley each own a 50% interest in
house A. Bradley owns an 80% interest in house B and Angelina
owns a 20% interest in house B. As Angelina and Bradley are both
busy actors who lead their own lives, they quite often live apart.
This year the sold both house A and house B. Angelina wants to
nominate house A as her main residence and Bradley wants to
nominate house B as his main residence. Advise Angelina and
Bradley as to how the main residence exemption will apply to them
assuming that (ignoring the exemption) a capital gain of $1m was
made on the sale of each house.
Advise Angelina and Bradley on the capital gains tax
consequences regarding the abovementioned transactions
for the 2014/2015 income year.
note:1-we have to mention type of tax calculation for both of them together.
2-we have to mention type of tax calculation for angelina if in her tax user
3-we have to mention type of tax calculation for bradley in his tax user.