Australian Taxation Law - Assignment Example

b) Eddie buys a house in January 2003 and sells it in Jan 2007. Therefore, this is a capital asset, and capital gains tax are applicable in this case (Global Property Guide, 2015). Since the transaction occurs after 21 September 1999, the capital gains taxable amount will be discounted at 50% since Eddie has owned the asset for at least 12 months. Capital gains tax is calculated on the net gain on the capital sale. c) The capital gains tax I this case will be net of $800,000 less the amount that John had paid to purchase the farm.

Since John is an individual, the calculations will be done on individual graduated scales of taxation. If it was a company, the tax rate is 30% flat (Global Property Guide, 2015). d) The total capital gains in Quantas shares is (1.56- 0.45) $1.11 per share and that in Westco is (2.10-5.20) a loss of $3.1 per share. The net gain in Quantas in added to the loss in westco and added to other revenues for calculation of tax for the individual. According to income tax assessment act 1997, the tax exempt entities include Community Service organizations, educational services, and charitable organizations (Australian Government, 2012).

These entities must be registered under the Australian Charities and not for profit commission act 2012. The capital gains discount where 50% discounting rate is used for assets held for at least 12 months and 33.33% for complying super funds, indexation for assets acquired before 21september 1999 and the third where cost base is deducted from capital proceeds (Austrilian Government, 2012). Jerry is conducting the business of fishing as much as it seems he is doing it as a hobby. Jerry compensates his sons for their efforts thereby creating a monetary value for their work and thus there is income earned by the sons.

Jerry also sells extra fish to the available market at prices he wishes and,