Taxation Law Essay Assignment Paper

Taxation Law

Description

Research Assignment Guidelines (see also subject outline for further information ) Please note: -As this is a research assignment, students are expected to go beyond the course materials and to conduct independent research in order to answer the assignment question.

-The content in the lecture topics listed in weeks 1 to 8 (see program on page 3 of the subject outline) will also provide useful guidance in relation to the assignment

. -Students are not required to address possible issues in relation to the lecture topics listed in weeks 9-12 of the subject outline (except to the extent that there is any overlap with lecture topics in weeks 1 to 8).

-Students are required to follow HIRAC to address the key issues arising from the  facts eg, “Is the [$x] expense incurred, deductible to Sarah under s8-1, ITAA97?”, “Is the [$y] amount/benefit received, included in Sarah’s assessable income?” etc

-Students should identify the relevant key cases, legislation, tax rulings and principles of tax law, in relation to each key issue.

-Students should also include any relevant calculations of the assessable or deductible amount regarding each particular key issue, however students are not required to calculate the overall income tax payable by the taxpayer for the income year.

-Students may assume, as per the facts, that Sarah is an Australian resident for tax purposes. Accordingly, there is no need to discuss tax residency.

Structure/format -Make sure you follow the HIRAC methodology (see “Concise Guide to Answering Tax Law Problem Questions” and “Example illustrating HIRAC methodology” on  UTS Online) -Use separate headings for each relevant key issue eg, “Is the [$x] expense incurred, deductible to Sarah under s8-1, ITAA97? -Maximum word limit is 1500 words (excluding references), students must not deviate from the word limit by more than 10% -Use at least 11 point font size (use one consistent font – Arial 11 or Times New Roman 12) Referencing -Make sure you include case citations for any cases referred to in your response eg, Brent v FCT (1971) 125 CLR 418 Case citations may be found easily in the Prescribed Textbook (see Table of Cases at the back of the textbook) or on the Lexis Advance Pacific database which can be accessed via the UTS Library website -Make sure you refer to any relevant specific sections of legislation for each key issue eg, s6-5, Income Tax Assessment Act 1997 (Cth) -Referencing style should be consistent throughout the response. For this assignment, students may use either:  AGLC (see links below): http://www.lib.uts.edu.au/help/referencing/aglc-guide

https://law.unimelb.edu.au/mulr/aglc/about 

or alternatively  UTS Harvard referencing (see http://www.lib.uts.edu.au/help/referencing/harvarduts-referencing-guide )

Taxation Law: Research Assignment (40%) Word limit: 1500 words maximum (excluding references) Due Date: The assignment must be submitted both in hard copy to Law Reception (Level 3, CB05 B) and online via UTS Online by 5 pm on Tuesday 5 February 2019. Facts: Sarah is a full-time interior design consultant employed by a large interior design firm Design Co Ltd. She is an Australian resident for tax purposes. Sarah’s main duties are to provide advice to clients, and to develop functional and aesthetically enhancing designs for the interior of buildings. Design Co Ltd pays Sarah a salary of $80,000 per year. Design Co Ltd provides Sarah with a laptop computer to use for her work, however does not provide Sarah with an office. She lives in Strathfield where she uses a spare room at home as her home office which is the base of her consulting operations, where she prepares advice and designs for clients. The home office takes up about 20% of the floor area of the house. She spends 60% of her time in the home office on design work and 40% of her time in the home office chatting on the phone with her friends. During the 2017/18 year, Sarah incurs expenses of $30,000 for interest on her home loan, $3,000 for insurance and $7,000 for lighting and electricity for the entire house. On 1 August 2017, Sarah paid $9,000 (GST exclusive) for a new piece of design equipment for her home office. The design equipment has an effective life of nine (9) years. From 1 August 2017, Sarah uses the equipment 60% for preparing designs for clients, and 40% for designing a new kitchen for herself, which she plans to build in the future. For the 2017/18 year of income, she pays $700 membership fees for her membership of the Interior Designers Association of Australia, and $500 for subscriptions to Interior Design journals. Sarah is occasionally required to travel to client premises to provide on-site advice and inspect the interior of buildings and afterwards she travels directly home from the client’s offices. During the 2017/18 year of income, she incurs travel expenses of $4,000 in travelling from home to client premises and back home again. She is required, by her employer, to wear “all black” clothing when meeting with clients. During the 2017/18 year of income, she spends $700 on “all black” skirts, trousers, and tops to wear to client meetings. Sarah is very hardworking and in addition to her full-time job, she also teaches art classes at a community college in Newtown during the week, in the evenings. She  travels from home to the college in Newtown to teach, and afterwards she travels directly home from the college. During the 2017/18 year of income, she incurs travel expenses of $5,000 in travelling from home to the college in Newtown and back home again. She receives $25,000 from teaching at the college during the 2017/18 income year. In July 2017, Sarah also commenced a Master of Business Administration (MBA) degree at university, as she hopes to move into a management role (and away from an interior design role) in the future. During the 2017/18 year of income, she incurred $6,000 for course fees and $700 for textbooks. In January 2018, while exploring the new year sales, Sarah came across a good bargain and purchased a 120-year old, antique bedroom furniture set (comprising a bed, 2 bedside tables and a chest of drawers) for $1,550 ($450 for the bed, $350 for each bedside table, and $400 for the chest of drawers). She negotiated with the vendor to buy each piece of the set separately. A few weeks later she received an offer of $4,400 for the set. She negotiated with the purchaser to sell each item separately ($2,000 for the bed, $700 for each bedside table, and $1,000 for the chest of drawers). Required: Advise Sarah regarding the tax implications to her, arising from the above facts, in relation to the 2017/18 year of income. In your answer, make sure you consider the potential assessability for income tax purposes to Sarah of any of the above events, and the availability of a tax deduction for any expenses  incurred. Also make sure that you apply the HIRAC methodology and refer to any relevant cases, legislative provisions, tax rulings and principles of tax law. (40 marks)

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Procurement of New Software for Processing Tax Returns

Procurement of New Software for Processing Tax Returns Order Instructions: Assignment 2: Competition Requirements

Federal Acquisition Review (FAR) Part 15 – Negotiations states “Exchanges of information among all interested parties, from the earliest identification of a requirement through receipt of proposals, is encouraged.” When planning a competitive solicitation, the agency must provide needed information in order to develop a thorough request that takes into account the agency’s objectives for quality, schedule, and costs.

Imagine that you are a contracts officer for the IRS, and your supervisor has tasked you with the procurement of a new software system for processing tax returns.

Write a two to three (2-3) page paper in which you:

Analyze the proposal adequacy checklist (http://www.acqnotes.com/acqnote/tasks/proposal-adequacy-checklist-pac) for organizing a proposal, and summarize the intrinsic value of two (2) of the suggestions on the checklist. Prepare and articulate an argument in support of your position.
Debate whether or not the offeree should let an offeror’s mistake within a proposal go uncorrected, even if such action would cause the offeror to withstand a loss.
Suggest one (1) judicial remedy available to the offeror to prevent his / her loss. Provide an argument in support of your position.
Use at least three (3) quality academic resources in this assignment. Note: Wikipedia and similar websites do not qualify as academic resources.
Format your assignment according to the following formatting requirements:
Typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
Include a cover page containing the title of the assignment, your name, your professor’s name, the course title, and the date. The cover page is not included in the required page length.
Include a reference page. Citations and references must follow APA format. The reference page is not included in the required page length.
The specific course learning outcomes associated with this assignment are:

Identify and apply the appropriate Federal Acquisition Regulation (FAR) clauses to meet compliance in contracting actions and dispute resolution requirements.
Explain the basic elements and compliance issues of the federal procurement framework (contract formulation, solicitation, costs, payment, financing, administration, and closeout).
Use technology and information resources to research issues in procurement and contract law.
Write clearly and concisely about procurement and contract law using correct grammar and mechanics.

Procurement of New Software for Processing Tax Returns Sample Answer

Proposal Title: Procurement of a New Software System for Processing Tax Returns

Proposal Adequacy Checklist

In the submission of a procurement proposal, it is significant that the PCO putts together an efficient bid package that finalizes the contract. On the other hand, there is a need that the PCO ensures that there is a checklist developed to monitor and ensure that all the areas of the contract are effectively covered and the pertinent information within the contract is included for the contracting parties (Dolgui, & Proth, 2013). The Federal Acquisition Regulation (FAR) plays an integral role in the formation of contracts and is a regulatory body of law that ensures the U.S Federal Government’s procurement process is governed.

This regulatory body was consequently established with the aim of simplifying the complexities involved in the procurement process between government agencies (Benaroch, Lichtenstein, & Fink, 2016). The central purpose of this body’s establishment is to ensure proper provisions are made through a universal contracting and procurement system. The body, therefore, helps in conducting assessments and monitoring functions on all the processes of procurement through the development of guidelines that need to be adhered to.

Intrinsic Value of Two of the Suggestions in the Checklist:

The first item detailed in the checklist is under FAR 52.215-20, as provided in section 52.215-20 that requires the offeror to make a submission of an exception on the certified costs and pricing data for the item contracted at either the prime or sub-contracting level. The second value that is essential in the checklist is part #14, FAR 15.408 under Table 15-2. On Section 2, under paragraph A, providing the services and materials section. In this case, as a PCO, it is essential that all listings for the services and materials are included in the proposal since these are the functions that will be billed (Dolgui, & Proth, 2013). In the checklist, the materials are inferred to as Bill of Materials (BOM), with FAR refereeing to this listings are Consolidated Bill of Materials (CBOM). As determined, the list of material and services in the checklist provide adequate information on the summaries of parts, materials, and services that are performed during the contract period.

In this case, it can be justified that the two elements provided in the checklist serve as essential in the procurement process since they determine the manner in which pricing structures are placed on the services and materials contracted (Han, & Mithas, 2013). Price, therefore, remains a significant element in the process since the government would want to engage vendors who offer fair and reasonable prices. As detailed, the government reserves the right to assess the price reasonableness and some of the pertinent information on the pricing data in order to approve the contracting process.

Debate on the Offeree’s Intent When a Mistake is made in a Proposal by the Offeror

In accordance to FAR 14.407, there are likelihoods of having mistakes in the proposal, mistakes may be corrected before or after the awarding of a contract has been done in any case such a mistake is not identified during this period. However, some mistake may be considered as simple since they are likely to result from clerical errors such as the placement of a decimal point where it should not be put, a factor that would advantage the offeree as compared to the offeror (Han, & Mithas, 2013). It is essential to realize that such errors and mistakes may be perceived as expensive and costly especially when they are not identified upon an award of a contract. In such a case, the offeree may take consideration of two options in regard to this case, to either reject or nullify the proposal on a basis on a known error or to take an advantage of the errors and mistake and take the proposal as it is, thus the offeree is considered as liable by the terms and the conditions stipulated in the proposal.

However, in an event where the offeror remits such a proposal to the offeree, the offeree may choose to enlighten the offeror on the errors and give a proposition on the submission of such a request, usually done in a duly written format addressing such exceptions (Han, & Mithas, 2013). The offeror, on the other hand, is mandated to grant the offeree a representative as bound by the contract to review the proposal with the aim of making verifications in any case the errors still exist.

On the other hand, it is essential to consider that liable charges on the mistakes identified in the proposal may be addressed to both the parties that engage in the contracting process. If an offeror sends the proposals to the offeree with some errors on it, the court is subjected to uphold a review process that will see the offeree, determined as a recipient bound by the terms of the proposal to adhere to the terms and conditions of the contents of the proposal. These statutes are also applied to acceptances (Han, & Mithas, 2013). Any violation of the stipulated procedures results in a breach of the contracting process. In this case, the process of procurement will begin with a determination of IRS needs in order to accomplish the mission of the organization. As the program officer, I will be in a position to determine the requirements that can be fulfilled and those that cannot within the procurement process such as the preparation of the preliminary specifications of the software systems. In this case, it is essential to determine that in contracting, considering the clauses since many of these clauses are considered as non-negotiable is important. Before contracting, it is necessary to review all the clauses that are contained in the solicitation even though some are bound to resemble the commercial clauses.

Judicial Remedy for the Offeror

In therefore arriving at a verdict, the court would, in this case, consider the offeror as a preferred party, thus validating a rule on business expediency. However errors according to some jurisdictions may be treated as not agreeable in the contracting process, thus both parties are conceived to have failed to arrive at an agreement. When this contract is breached by a contractor, the termination clause comes into play. A breach, in this case, may occur in the event that the supplier fails to deliver the software system or makes progress that would endanger the performance of the contract (Han, & Mithas, 2013). Consequently, this gives me as the contracting officer at IRS to terminate such a contract for default as determined in the clause FAR 52.249-81 (A) (1).

Procurement of New Software for Processing Tax Returns References

Benaroch, M., Lichtenstein, Y., & Fink, L. (2016). Contract Design Choices And The Balance Of Ex Ante And Ex Post Transaction Costs In Software Development Outsourcing1. MIS Quarterly, 40(1), 57-82.

Dolgui, A., & Proth, J. (2013). Outsourcing: definitions and analysis. International Journal Of Production Research, 51(23/24), 6769-6777. doi:10.1080/00207543.2013.855338.

Han, K., & Mithas, S. (2013). Information Technology Outsourcing And Non-It Operating Costs: An Empirical Investigation. MIS Quarterly, 37(1), 315-331.

Taxation Law Case Study Assignment

Taxation Law Case Study

Sebastian Dangerfield is a Computer Programmer and IT Consultant. He started working on a series of projects for Giga Systems Ltd in March 2012 and since then he has worked on a new project for them every 4 to 6 weeks until the present
The projects usually provide about £4000 to £6000 each and he usually does 10 per year
Sebastian is under no obligation to accept any of the projects and works entirely under his own control
Sebastian works from his office at home which has been fully equipped for his likely range of tasks. He rarely visits the premises of Giga Systems. His
office occupies one room of his 5 room home and incurs considerable overhead costs for typical items such as heat/light, phone, etc
In relation to Giga Systems: List those factors which will be considered by HMRC when they determine whether Sebastian is an employee or is self-employed, and the relevant law as authority.
Advise Sebastian as to his situation and how best he should proceed.

Reference should be made to all relevant sources of law and should be appropriately researched.
The essay should be double spaced, font size 11 Verdana. The word limit cannot go under 1800 or more than 2200 words.

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Final Tax Liability and Legislation Case Study

Final Tax Liability and Legislation Case Study Order Instructions: I just want the treatment of the nine points mentioned in the first section of case study and related section numbers in of the tax legislation.

please try to provide an answer in the best possible way especially for this section as I have done the other sections. and aslo, please provide the final tax liability

Final Tax Liability and Legislation Case Study Sample Answer

Introduction

The income tax in Australia is payable annually on all the personal income received by a person living in Australia whether he is a resident or non-resident as long as the income was derived or earned in Australia. The profits earned from a business operating partly in or out Australia are taken to have been earned totally from Australia. All the income earned from investments or the sales of personal property in Australia are subject to taxation. (Renton, 2005) The sale of properties or assets will attract GST and the tax credits will have to be deducted from the sales earnings to get the taxable income. Some allowable expenses can also be deducted like the cost of the materials and labor used. The expenses or the costs that have been incurred in the repair work, renovations or construction process can be deducted to arrive at the taxable income of the whole project. The net losses from a previous year can be offset against other capital gains when carried forward but they cannot be offset against the net earnings (ATO, 2005)

The rental income he receives from the sublease is subject to taxation provided that he received the payments from the sub lease. The personal contract between the lessor and the lessee are not significant when it comes to the payments received. The total amount of lease payment that totaled to 10800 does not include the 3000 received as the rent for the sublease.

The other item that may not be allowable as an expense is the provision for settlement amounting to 10,000. That amount will have to be added back to the trading profit to arrive at the total taxable profit of 72550.

The refunded amount of 500 is allowable and it’s deducted from the gross profit to arrive at the taxable income. This amount represents a loss on the part of the seller.

Peter
Profit and loss A/c
For the financial year 2013/2014

Sales receipts		220,000
Sublease		3000
refunds		-500
		222,500
Purchases	95,000
Tender costs	750
License fees	6500
Vendors licences	1200
Lease payments	10800
Cooking materials	3700
wages	32000
provision for settlement	10,000
Total Expenses		159,950
Trading Profit		62,550

Purchases			95,000
Sales	78,500
Returns Outwards			10200
Net Purchases			84,800
staff consumption		1800
Peters consumption		4500

The returns outwards amounting to 10200 are not an allowable deduction and they have to be added back to the taxable income. The staff consumption is also a benefit to the staff and they will also be subjected to the income tax on their salaries. The amount taken as consumption by peter amounting to 4500 is also part of his drawings and it will either be paid as income on his salary or it can be added back to the trading profit of the company to be part of the taxable income.

The tender costs which include the accounting fees and other costs are allowable and they can be treated as part of the company’s expenses.
The annual levy is an allowable expense.
The various licences requirements for the government are also allowable expenses.
The total amount payable for the financial period is 10800 and the amount owing will be reflected as a liability in the next financial period. Its payment will however not be reflected in that financial period as it refers to the current financial period.
The total amount is allowable but the employees will be individually liable to declare all their earnings and be subjected to income tax on all their benefits including the bonus payments.
These amounts refer to a provision that peter may be contemplating to reserve for the court case but it’s not allowable. It will however be allowed ones it’s paid to the lawyer in the next accounting or financial period.

Final Tax Liability and Legislation Case Study Other Questions

Capital gains taxation system was first introduced in Australia in 1985 September as one of the major reforms in the taxation laws of the government. It only applies to assets that were later acquired after the introduction of the tax. Capital gains tax referred to as the CGT is applied to all the capital gains that have been earned when the assets are disposed of except where it refers to the family house. The capital gains tax treats all the profits or the net gains taxable income. If the gains or profits are earned as a result of the assets having been in existence for a year or more then the profits or gains are discounted by 50 percent for individual taxes or by 33.3 percent for amounts that are superannuation. (ATO, 2005)
Peter will be expected to pay taxes on all the profits he made from the sale of his house less the expenses he incurred on the stamp duties and legal fees. These will amount to $800,000 less $408,500. The taxable income or gain will be $391500. He will also pay all the taxes on his rental income from the property. These will include all the rental income earned from 1^st July 2011 to 31^st December 2013 then from 1^st February to 31^st March 2014.

2. Albany
Purchased a house	150,000
Stamp duty	10,000
Loan application	1000
Interests	50,000
Pergola	6,000
Legal fees	3,000
Total		220,000
Other Expenses
Agents fees	5,000
Stamp duty	2,000
Advertising	500
valuation	300
Search fees	200
Mortgage discharge	600
Total		8,600
Grand total expenses		228,600
Sale of house		950,000
Total profit		721,400
2.Taxable income		721,400

The total amount will be discounted by 50% and be subjected
to taxation

Stocks
	Purchased	Sold	Profit
Shares in A ltd	5000	6000	1000
Shares in B ltd	5000	7000	2000
Shares in C ltd	5000	4000	-1000
Taxable income			2000

The taxable income is 2000 but all the dividends received within the period when he had the shares may also have been subjected to taxation. (ATO, 2005)

Rhodesia Running profit is equal to 5000 less 450. The taxable income is equal to 4550.
The net losses from a previous year can be offset against other capital gains when carried forward but they cannot be offset against the net earnings. The use of other assets that are personal such as collectables are classified in different categories while the losses incurred or registered on them are quarantined i.e. the trader or taxpayer can is allowed to offset them against other future gains or profits which are strictly limited to the same category. This is one method of discouraging the taxpayers from using their investment income to subsidize their earnings from other investments. (ATO, 2005)

Final Tax Liability and Legislation Case Study Reference

ATO (2005) Carrying on a business of share trading – Fact Sheet, Australian Taxation Office

ATO (2005) Guide to Capital Gains Tax Concessions for Small Business, Australian Taxation Office, publication NAT 8384-06.2005

ATO (2005) Guide to Capital Gains Tax, Australian Taxation Office, publication NAT 4151-6.2005

Renton, N.E. (2005) Income Tax and Investment, 2nd edition, 2005, ISBN 0-7314-0221-9