Discuss About The Benefits Under The Section Taxation Rulings?

Calculation of Fringe Benefit Tax

Question:

Discuss About The Benefits Under The Section Taxation Rulings?

According to Australian Taxation Tax, it is noted that Fringe Benefit Tax is the tax that is paid by the employers for paying benefits as it is offered to the employees (Grange, Jover-Ledesma and Maydew 2014). It takes into account family of the employees as well as other associates that are linked together. The benefits that are paid as additional can be treated as part of wages or salaries of the employees. For example, the benefits that are taken by the directors from the income tax as well as FBT need to be calculated as taxable value as provided by Fringe benefit tax (Krever 2013).

At the time of preparing Fringe benefit tax return for the year ended 2016/2017 year, an individual can continue to use lists of eligible as well as ineligible vehicles or the principle-based approach or methods. In addition, the eligible as well as ineligible vehicle lists can be removed after 2017 (Grange, Jover-Ledesma and Maydew 2014). To that, the product mentioned are structured for offsetting the rate of interest that is maintained by the clients. The above table explains the calculation of loan fringe benefits under the section Taxation Rulings TR 93/6. In this section, it explains how business plans for their loan offset that in actual is known as interest offset accord. It is further concluded by saying that paying any sum of income legal responsibility is taken into considered when Brian is unrestricted from paying interest by the bank (Krever 2015).

It is important to understand person who are liable to pay for fringe benefit tax (Grange, Jover-Ledesma and Maydew 2014). This is where any person or employer offers any of the fringe benefits to his employee or the associate of the employee that aligns with status of employment as paid for fringe benefit tax. Furthermore, the employee for which the employer is needed to pay fringe benefit tax can be done for past, present or for future employee. The imposition of fringe benefit tax is mainly proposed to tax companies on situation provided to their employees as mentioned in the budget among the corporate and tax circles (Morgan, Mortimer and Pinto 2013). The fringe benefit provided by an employer to his employees in addition to cash salary or wages payments considered as fringe benefit tax (Coleman and Sadiq 2013).

Taxable Position of Co-Owners

In addition, the rulings highlight evaluating regarding the taxable position of co-owners of those who are not responsible to carry out their values within actions. From the given situation, it is noted that Jack and Jill need to evaluate their taxable position of the rental property. In addition, the loss of profits gained from the leasing possessions in actual need to be managed through co-ownership of rental property and deal out business proceeds and losses. Thus, the co-owners of the leasing possessions named as Jack and Jill will be investment the property as joint ventures and this act as an ordinary issue in the given case state of affairs (Sadiq et al. 2014). As far as Taxation ruling of TR 93/32 is concerned, it highlights the fact when acceptability for the purpose of income tax can be treated as net income profit or loss. Here, Jack gets a share of 10% and Jill will get 90% of the total profit gained (Grange, Jover-Ledesma and Maydew 2014). In that case, if Jack and Jill both sell property when the cost base as well as reduced cost needs to be taken into addressed with gains or losses in alignment of interest ownership for specific property

The provided case is in accordance with the law named as IRC v Duke Westminster (1936) that is shown in specific event for the purpose of avoiding tax. In this case, one gardener was employed by the dyke who actually paid from the post-tax income of Duke (Morgan, Mortimer and Pinto 2013). Furthermore, it is noted that the tax purpose is chargeable when he stopped paying the gardener irrespective of paying for the same amount of money. The present case deals with taxation ruling that enables Duke for claiming deduction from his taxable income as it get reduced with the income tax liability. As far as present case is concerned, each person is entitled for planning the tax avoidance based on the current requirement or preference where no person can be forced to pay higher amount of tax. This present case study has proper relevance from Australia where it is clearly mentioned that each of the individual has the right to select their own transaction where taxpayer achieves the advantage of given asset as a matter of fact (Novikov, Ling and Kordzakhia 2014). The person will be able to select or choose the option of the transaction as it will subject to tax or subject that is deducted tax as compared to others. The case law states the fact about principles where every person or individual should be permitted to understand the tax affairs and laws properly to avoid further confusion. The cases explained reveals the fact that courts have looked over the overall impact and made the decisions accordingly (Schreiber 2013). As far as present case is concerned, the transaction has to be pre-arranged artificially as well as not served properly for commercial activities. The cases explained reveals the fact that courts have looked over the overall impact and made the decisions accordingly. As far as present case is concerned, the transaction has to be pre-arranged artificially as well as not served properly for commercial activities (Davis et al. 2015).

Deductibility of Expenses for Primary Production and Forestry Activities

In the current complex state of affairs, it is noted that the standard within Australia depicts the fact that if an individual start achieving success for making the results secured, then the Inland Revenue might be current as a proposal as they cannot force anyone for paying any increased amount of tax (Woellner 2013). 

The provided case on Bill relates to taxable income as it is explained by the taxpayer as Bill is the Primary Producer as under Section 6 (1) of the ITAA 1997.

As far as current situation is concerned, it is noted that Bill owns a large piece of land where there are several pine trees (Woellner 2013). In addition, Bill principally aims at using the land for grazing sheep as well as wanted to have it cleared. To that, it is noted that the logging company had grabbed from his piece of land. These aspects mainly explain assessable income whether the taxpayers gets indulged with the activities of forestry industry. To that, the forest operations take into account felling of trees in a forest or plantation where the taxpayers show no interest about the planted trees (Douglas et al. 2014).

Under Taxation Ruling TR 95/6 that explain about Income tax dealing with primary production as well as forestry that highlights different deductions that are made available to the primary producers that is engaged at the time of conducting forest operations or activities (Coleman and Sadiq 2013). In addition, the deductibility of these expenses cannot be altered by simple fact that an individual derive income from carbon sequestration activities as it is carried on in conjunction and aligns according to forestry activities or operations (Petty et al. 2015). Here, it is important to consider the fact that general deduction is not allowed for cost of planting trees when the individual purpose is participating in carbon sequestration activities as well as those trees as it is not intended to be felled in a business of forestry. In addition, it is because of the cost for planting in these conditions and is known as capital expenditure. Capital expenditure for planting trees can be perceived as other income tax treatment that majorly depends upon the context in which expenditure is incurred when the trees are treated as horticultural plants (Coleman and Sadiq 2013). The trees that are used for sale of products or parts and the cost for establishment are mainly written off after referring to the effective life of the plant. Hence, trees that are used solely for carbon credit arrangements are mainly not cultivated for any of the products or parts as it does not constitute horticultural pants for the purpose of applying the horticultural plant deduction as shown in the section (Taylor and Richardson 2013).

As per the case, the concerned sale combines either completely or partial assets of the business (Ross, Walker and Walker 2017). In that case, McCauley v The Federal Commissioner of Taxation payments mainly obtains from the grantor under the right of performing the operations in correct way. From the given case study, it is noted that Bill is treated as a basic producer because he gets engaged into the process of primary production in accordance to subsection 6 (1) of the Income Tax Assessment Act 1936 (Coleman and Sadiq 2013). To that, the forest operations take into account felling of trees in a forest or plantation where the taxpayers show no interest about the planted trees. In that case, McCauley v The Federal Commissioner of Taxation payments mainly obtains from the grantor under the right of performing the operations in correct way (Woellner et al. 2014).

It is concluded that the outcomes from the cases shows that first case is received from the amount of Bill that will be taxable under income tax. As far as second case is concerned, the amount of Bill received by him will be treated as royalty.

References

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Davis, A.K., Guenther, D.A., Krull, L.K. and Williams, B.M., 2015. operations responsible firms pay more taxes?. The Accounting Review, 91(1), pp.47-68.

Douglas, H., Bartlett, F., Luker, T. and Hunter, R. eds., 2014. Australian feminist judgments: Righting and rewriting law. Bloomsbury Publishing.

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