Assignment 1: you should attempt both parts to this assignment.
Note: you should incorporate all sections of the various Acts/regulations where appropriate.
Part 1: Concepts of Income
a) Is it possible for an employer to provide a regular payment to a former employee, can it be on the basis to compensate for a lower salary income or is it treated as a gift? Included in your answer should be any taxation considerations to both parties.
b) Explain what constitutes a business for taxation purposes so that income derives by the taxpayer must be assessed for income tax.
Part 2: Deductions
Question Ã¢â‚¬Å“General DeductionsÃ¢â‚¬Â
1) What is your view re: compulsory business expenses and their deductibility under s8-1 ITAA97 where they are incurred AFTER the business ceases to operate? How does this compare to expenses such as legal fees?
2) Question Ã¢â‚¬Å“Specific DeductionsÃ¢â‚¬Â
Explain the difference between capital improvements compared to repairs and maintenance, giving consideration to a taxpayer who owns a rental property.