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程序代写案例-LAWS7012 2022
时间：2022-07-19
LAWS7012 2022 S1 Practice Exam
1/26
Academic Integrity Pledge
Academic Integrity is a core value at UQ. We all need to act with courage to take our
responsibilities seriously and uphold honesty, trust, respect and equity, particularly in assessment.
For you as a student this means:
completing your assessment tasks, whether face-to-face or online, in an honest, fair and
trustworthy manner;
acting responsibly, based on your lecturer or tutor’s instructions, and not giving or receiving
any unauthorised assistance to others in completing assessment tasks;
commitment to act honestly and refusing to take any action that would break trust with your
peers and lecturer/tutor.
By undertaking this online assessment you will be deemed to have acknowledged UQ’s Academic
Integrity Pledge (above) and to have made the following declaration:
“I certify that my submitted answers are entirely my own work, that I have only used the permitted
resources detailed on the course site in completing this assessment item, and that I have neither
given nor received any unauthorised assistance on this assessment item”.
Instructions to Students
This is a timed open book online invigilated exam. You are not permitted to use any
electronic device other than the computer that you use to sit this exam. You must abide by
the requirements to sit an Inspera exam that are available on the course site on Blackboard.
Answer all questions.
Duration is 120 minutes plus 10 minutes planning time.
There is NO additional 15 minutes of upload time as the exam submits instantly when you
press ‘Submit now’ (on the last page of the exam).
At the end of the total exam duration, you must press ‘Submit now’ to submit your exam. If
you complete your exam before the end of the exam duration and submit, you cannot return
to your exam to update answers or make any amendments, even if you do so before the
end of the total exam duration. Submitting your exam is final.
If you are still working at the end of the total exam duration, you will be taken to the summary
page and prompted to ‘Submit now’. You will not be able to keep writing or modify your
answers once the time for the exam period has elapsed.
LAWS7012 2022 S1 Practice Exam
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Part A - Multiple Choice Questions
This section consists of 10 multiple choice questions (Question 1 - 10) worth 1
mark each for a total of 10 marks.
Please choose the best alternative.
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1 LAWS7012 2022 S1 Multiple Choice Question 1
Homelife Pty Ltd designs and manufactures quilted bedspreads, which they sell at wholesale
prices to retailers. The company provides you with the following information in relation to the
manufacture and sale of their bedspreads:
Total purchases of materials during the 2021/22 income year: $150,000
Total sales of bedspreads during the 2021/22 income year: $500,000
Twenty bedspreads at a total cost of $1,500 were donated to a local homeless shelter (note
the organisation running the homeless shelter is not a deductible gift recipient). The market
value of these bedspreads amounts to $3,000.
STOCK VALUES
STOCK ON HAND 1 July 2021 30 June 2022
Completed bedspreads ready for sale $26,000 $32,000
Partly completed bedspreads $12,000 $14,000
Fabric $44,000 $45,000
Padded filling materials $8,000 $9,000
In relation to the information provided above, which one of the following statements is
FALSE?
[A] Homelife Pty Ltd will be entitled to claim a deduction under section 8-1 of the ITAA97 for
the purchase of the materials used to manufacture their bedspreads.
[B] Homelife Pty Ltd will assessed on their sales income under section 6-5 of the ITAA97.
[C] Homelife Pty Ltd will not be entitled to a deduction under Div 30 of the ITAA97 for their
donation to the homeless shelter as the shelter is not a deductible gift recipient.
[D] Homelife Pty Ltd will have an assessable year-end adjustment under section 70-35 of
the ITAA97.
[E] Homelife Pty Ltd will be assessed on the cost of the bedspreads given to the homeless
shelter under section 70-90.
Maximum marks: 1
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2 LAWS7012 2022 S1 Multiple Choice Question 2
Vinh is a car dealer and holds cars in his business as trading stock. During the current income
year Vinh decides to sell his private vehicle through his business. He purchased the vehicle for
$35,000 in 2016 and its market value is now $20,000.
Which of the following statements is MOST correct?
[A] In accordance with 70-90, Vinh’s business will be deemed to have acquired his vehicle
at its market value of $20,000.
[B] In accordance with section 70-110, Vinh’s business will be deemed to have acquired his
vehicle at its cost of $35,000.
[C] In accordance with section 70-30, Vinh’s business can choose whether to acquire his
vehicle at its cost or its market value.
[D] If Vinh elects to start holding his private vehicle as trading stock at its cost price, there
may be CGT consequences on the disposal of his vehicle to his business.
[E] There will be no tax consequences under the trading stock provisions in relation to Vinh
selling his private vehicle through his business.
Maximum marks: 1
LAWS7012 2022 S1 Practice Exam
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3 LAWS7012 2022 S1 Multiple Choice Question 3
Susan Jones runs a childcare centre, which is registered for GST. The centre purchases $330
(including GST) of cleaning products from a national supplier for use in its premises. The supplier
provides Susan with a tax invoice for the purchase.
In respect of the purchase of the cleaning products, which one of the following statements
is most CORRECT?
[A] The childcare centre cannot claim any input tax credits on the purchase of the cleaning
products because childcare is a GST-free supply.
[B] The childcare centre can claim an input tax credit of $30 on its purchase of the cleaning.
[C] The childcare centre cannot claim any input tax credits on the purchase of the cleaning
products because childcare is an input taxed supply.
[D] The childcare centre can claim an input tax credit of $33 on its purchase of the cleaning
products.
[E] The cleaning product supplier should not have charged any GST to the childcare centre
on the supply of its cleaning products as childcare centres make GST-free supplies.
Maximum marks: 1
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4 LAWS7012 2022 S1 Multiple Choice Question 4
Which one of the following expenses is MOST likely to be deductible under section 25-10 of
the Income Tax Assessment Act 1997 as a repair?
[A] The cost of purchasing a replacement glass jug for an expensive blender machine used
in a hotel bar. The bartender had been careless when using the original glass jug to make a
frozen cocktail in the blender by allowing the cocktail to run down the outside of the jug,
which made the handle slippery thus causing him to drop it on the tiled floor where it
smashed into pieces.
[B] The cost of replacing a blender machine in a café with a new one after the motor in the
former blender machine burnt out due to overuse.
[C] The cost of replacing a granite benchtop in a family home after the heat from the family’s
air fryer caused the benchtop to crack.
[D] The cost of purchasing a dough hook as an additional accessory for a benchtop mixer
used in a café. Having the dough hook will allow the café’s cook to start baking fresh bread
on site for use in the café’s dishes.
[E] The cost of replacing the heating element in a commercial oven used in a bakery. The
bakery purchased the oven second-hand for a bargain price as the original heating element
had worn out, and the seller was going out of business and did not want to spend money on
repairing it before selling it.
Maximum marks: 1
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5 LAWS7012 2022 S1 Multiple Choice Question 5
An environmental research company is tasked with undertaking research in Australia on the
environmental impacts of climate change. The company owns five caravans, which it allows their
employee environmental scientists to use as temporary accommodation while away on research
trips in remote areas.
The provision of the caravans for the employees’ use would fall into which category of
fringe benefit?
[A] Expense payment fringe benefit.
[B] Residual fringe benefit.
[C] Car fringe benefit.
[D] Property fringe benefit.
[E] Loan fringe benefit.
Maximum marks: 1
6 LAWS7012 2022 S1 Multiple Choice Question 6
Which one of the following items provided to an employee by their employer is NOT an
eligible work-related item under s 58X of the FBTAA86?
[Assume that all items are used primarily by the employee for work purposes].
[A] An iPhone.
[B] A laptop computer.
[C] A fluoro safety vest.
[D] A calculator.
[E] A car.
Maximum marks: 1
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7 LAWS7012 2022 S1 Multiple Choice Question 7
Tina Green has set up the Green Family Trust (a discretionary trust), with Scarlet Ltd as the
trustee of the trust.
Given that due to an oversight no beneficiary is presently entitled to $10,000 of the 2021/22
income year net income of the trust, which one of the following statements is CORRECT?
[A] No income tax will be payable on the $10,000 of net income as no beneficiary is
presently entitled to it.
[B] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $3,000 in income
tax on the $10,000 of net income as Scarlet Ltd is a company.
[C] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $4,500 in income
tax on the $10,000 of net income.
[D] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $4,700 in income
tax on the $10,000 of net income.
[E] Tina Green will be personally liable to pay income tax on the $10,000 of net income at
her appropriate marginal tax rate because Tina was the person who set up the Green Family
Trust.
Maximum marks: 1
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8 LAWS7012 2022 S1 Multiple Choice Question 8
Wei, Cheng and Jing co-own a residential investment property together. They each contributed
equally to the cost of the property but as Wei and Cheng have no dependents whilst Jing has three
young children, they decided that the net rental income from the property should be distributed as
follows:
Wei: 20%
Cheng: 30%
Jing: 50%
If the net rental income for the current income year is $30,000, what amount should WEI
include in his assessable income in the current income year in respect of the rental of this
property?
[A] $6,000
[B] $9,000
[C] $10,000
[D] $15,000
[E] $24,000
Maximum marks: 1
LAWS7012 2022 S1 Practice Exam
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9 LAWS7012 2022 S1 Multiple Choice Question 9
Which one of the following would be most likely to be treated as a depreciating asset under
section 40-30 of the Income Tax Assessment Act 1997?
[A] Land used for farming.
[B] A farm shed.
[C] A tractor used on a farm.
[D] A rock retaining wall built on farmland.
[E] A combine harvester machine held by a farm equipment retailer as trading stock.
Maximum marks: 1
LAWS7012 2022 S1 Practice Exam
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10 LAWS7012 2022 S1 Multiple Choice Question 10
Janet, a resident of Australia for tax purposes, sold a block of vacant land $500,000 under a
contract dated 12 June 2022, with the settlement date being 20 July 2022. In relation to the sale,
Janet incurred solicitor’s fees of $1,000 and a real estate agent’s commission of $9,000.
Janet purchased the land for $250,000 under a contract dated 20 April 2010, with settlement
occurring 24 May 2010. In relation to the purchase of the property, Janet incurred solicitor’s fees
of $1,000 and transfer duty (stamp duty) of $19,000.
Originally Janet had intended to build a house on the land and move into it as her main residence.
However, this never eventuated so the land remained vacant over Janet’s ownership period.
Janet had to borrow money from the bank to fund the purchase of the land and incurred a total of
$50,000 in interest over her ownership period. Janet also incurred a total of $40,000 in council
rates. Janet was unable to claim a tax deduction for either of these costs.
In relation to the facts about Janet, which one of the following statements is TRUE?
[A] The resulting capital gain or capital loss from the disposal of the land should be included
in Janet’s net capital gain for the 2022/23 income year.
[B] The total value of the incidental costs that can be included in the cost base is $30,000.
[C] For CGT purposes, Janet’s acquisition date for the block of land is 24 May 2010.
[D] The $90,000 in interest and council rates that Janet incurred over her ownership period
cannot be included in the cost base as the block of land is a personal use asset.
[E] As Janet had the intention to build a house on the land, she can disregard the capital
gain on the sale of the land under the main residence exemption.
Maximum marks: 1
Part B - Problem Questions
This section consists of three problem questions in parts (Question 11 - 13).
Marks are as indicated in each question for a total of 50 marks.
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(a) LAWS7012 2022 S1 Practice Exam Question 11 Statement (a)
If a taxpayer makes a capital loss on the disposal of their personal jewellery, they can use that
capital loss to reduce any type of capital gains that they might have.
Type your answer here
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Maximum marks: 2
11 QUESTION 11
For each of the statements on the right [Statement (a) - (e)] indicate whether the
statement is TRUE or FALSE and give a brief EXPLANATION for your answer
citing relevant legislation, case law or rulings as appropriate.
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(b) LAWS7012 2022 S1 Practice Exam Question 11 Statement (b)
Employees are entitled to claim a general deduction under section 8-1 of the ITAA97 for their
childcare costs where the provision of the childcare enables them to gain or produce their
employment income free from the restraint of looking after their children.
Type your answer here
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Maximum marks: 2
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(c) LAWS7012 2022 S1 Practice Exam Question 11 Statement (c)
In calculating the ‘net income’ of a partnership under section 90 of the ITAA36, a salary paid to a
partner is deductible.
Type your answer here
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Maximum marks: 2
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(d) LAWS7012 2022 S1 Practice Exam Quesetion 11 Statement
(d)
If there is trust income to which no beneficiary is presently entitled, then that portion of trust
income will not be subjected to income tax as it has not been distributed to anyone.
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Maximum marks: 2
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(e) LAWS7012 2022 S1 Practice Exam Question 11 Statement (e)
One of the many benefits of using a discretionary trust to carry on a family business is that the
income tax burden can be legitimately minimised by splitting the trust income such that all family
members, including young children, are entitled to an equal share.
Type your answer here
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Maximum marks: 2
LAWS7012 2022 S1 Practice Exam
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12 QUESTION 12
General details
Manjula is a 32-year-old financial planner who is employed by a large financial
planning firm based in Brisbane. Manjula is single and does not have any
dependents. Note that Manjula is an Australian resident for tax purposes and does
not have private health insurance.
For the 2021/22 income year Manjula received a PAYG payment summary from her
employer containing the following details:
Gross salary payments $87,000
Allowance $1,000
Reportable fringe benefit amount (RFBA) $3,962
Reportable employer superannuation contribution (RESC) $10,000
Total tax withheld (PAYG credits) $21,632
Work-related expenses
Manjula is required to present herself well at work, and to maintain a
professional image by wearing suitable business attire. During the 2021/22
income year, Manjula spent a total of $2,750 (including GST) on clothes (such
as blouses, skirts, and jackets) and shoes to wear at work. Manjula has also
spent $385 (including GST) on having her suit jackets and skirts dry-cleaned.
On 22 December 2021 Manjula paid $1,320 (including GST) for her annual
Financial Planning Association of Australia (FPA) membership fee. The fee
covers Manjula’s membership to the FPA for the 2022 calendar year (1
January 2022 to 31 December 2022). Note that the $1,000 allowance that
Manjula received is in recognition of this annual expense.
Manjula often completes some of her work from home in the evenings and on
the weekends as she finds it more convenient to work from home than to
travel into her workplace out-of-hours. She has a home office area set up in
her rented apartment for this purpose. Manjula kept a diary for a representative
4-week period to record her hours of usage and found that she used her home
office for 37 hours over that 4-week period. Note that Manjula pays $380 per
week in rent for her apartment and took two weeks of annual leave over the
2021/22 income year.
Manjula spent $140 (including GST) on a new bookcase for her home office as
she needed extra storage space for her financial planning journals and
reference books. The effective life of the bookcase is 10 years.
Manjula uses her own laptop computer when working from home. She bought
her current laptop computer on 28 June 2021 but did not get around to taking it
out of the box and setting it up until 1 July 2021. The laptop computer cost
$1,650 (including GST) and has an effective life of 2 years. Manjula reliably
estimates that she uses the laptop computer for work purposes 80% of the
time.
Over the 2021/22 income year, Manjula incurred $3,500 (including GST) in
mobile phone and internet expenses; however, her employer has reimbursed
LAWS7012 2022 S1 Practice Exam
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her in full for these expenses (note that Manjula’s reportable fringe benefit
amount relates to this reimbursement). Manjula reliably estimates that 40% of
her phone and internet expenses are work-related.
Manjula attended the annual Financial Planning Association of Australia (FPA)
conference, which was held in Brisbane from 4 to 6 March 2022. The
registration fee cost $1,850 (including GST). Attendance at the conference
enables Manjula to keep up to date with developments in her field and to
network with her peers. For each of the three days of the conference, Manjula
travelled by public transport to the conference location at the Brisbane
Convention Centre from her apartment and back again. This travel amounted
to a total cost of $20 (including GST).
Other expenses
Manjula made two cash donations during the 2021/22 income year:
- She donated $250 to the Breast Cancer Network Australia (BCNA). Note that
the BCNA
is a deductible gift recipient.
- She donated $2,000 to a registered Australian political party.
Investment property
Manjula and her brother Suresh purchased an investment property located on the
Sunshine Coast as ‘tenants in common’, each with a 50% ownership interest in the
property. They signed the contract to buy the property in June 2021, with the
settlement date being 29 July 2021. The seller provided them with the builder’s
certificate stating that the construction cost of the house was $280,000. Since
purchasing the property, Manjula and Suresh have continued to rent it to the existing
tenants at $500 per week.
During the 2021/22 income year, Manjula and Suresh have incurred the following
costs in relation to the property (note that they have met each of the expenses
equally):
Stamp duty on the purchase of the property $22,000
Legal fees on the purchase of the property $3,000 (incl. GST)
The property cost $600,000 and to meet the purchase price, Manjula and
Suresh contributed $50,000 each towards the deposit, and borrowed the
remaining $500,000 from a bank under a 30-year loan term. The loan was
taken out on 29 July 2021. In relation to the loan, they incurred the following
expenses:
- Loan establishment fees $2,500
- Valuation fees (for loan approval) $2,000
- Lender's mortgage insurance $9,500
- Interest payments $15,964
- Repayments of principal $9,500
Council rates $2,200 (incl. GST)
LAWS7012 2022 S1 Practice Exam
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Property insurance (29 July 2021 – 28 July 2022) $990 (incl. GST)
Property management fees ($50 per week) $2,400 (incl. GST)
On 1 March 2022, there was a bad hailstorm on the Sunshine Coast, which
resulted in all the windows on one side of the house being broken. Manjula and
Suresh arranged for the windowpanes to be replaced on 2 March 2022 at a
cost of $1,400 (including GST). Unfortunately, their property insurance
excluded hailstorm damage, so they did not receive any insurance proceeds in
relation to this.
Further information
All expenses can be substantiated.
The Commissioner’s fixed rate for home office running costs is $0.52/hour for
the 2021/22 income year. Alternatively, the rate for the ATO’s shortcut method
is $0.80/hour for the 2021/22 income year.
In relation to any capital allowances, Manjula would like to use the diminishing
value method. She does not have a low value pool and does not wish to start
one.
In relation to any capital works deductions, use the 2.5% rate.
LAWS7012 2022 S1 Practice Exam
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(a) LAWS7012 2022 S1 Practice Exam Question 12 (a)
Calculate Manjula and Suresh’s NET RENTAL INCOME OR LOSS for the 2021/22 income
year. Ensure that you provide full workings and explanations, and that you specify section
references to the ITAA97 or ITAA36 and relevant case law decisions to support your
calculations.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Description Amount Law and explanations
$
Type your answer here
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Maximum marks: 13
LAWS7012 2022 S1 Practice Exam
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(b) LAWS7012 2022 S1 Practice Exam Question 12 (b)
Calculate Manjula’s TAXABLE INCOME for the 2021/22 income year. Note that you will need to
complete Part (a) of this question before starting this calculation. Ensure that you provide full
workings and explanations, and that you specify section references to the ITAA97 or ITAA36
to support your calculations.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Description Amount Law and explanations
$
Type your answer here
Format
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Words: 0
Maximum marks: 14
LAWS7012 2022 S1 Practice Exam
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(c) LAWS7012 2022 S1 Practice Exam Question 12 (c)
Identify whether Manjula is liable to pay the MEDICARE LEVY SURCHARGE for the 2021/22
income year, and if so, calculate the value of that liability. Note that you will need to complete
Parts (a) and (b) of this question before starting this calculation. Ensure that you provide full
workings.
Type your answer here
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Maximum marks: 3
LAWS7012 2022 S1 Practice Exam
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13 QUESTION 13
Lauren is employed as a Senior Consultant at Strategic Solutions Pty Ltd (SS Ltd), a
business advisory company located in Brisbane. During the 2021/22 income year,
her employment remuneration package consisted of the following:
1. Cash salary $120,000
2. Superannuation guarantee contributions $11,400
3. A car provided by SS Ltd for Lauren’s personal use and to travel to various
clients’ premises. SS Ltd leases this car under a contract commencing on 30
January 2021. The value of the leased car at the commencement of the
contract was $44,000. During the 2021/22 FBT year, Lauren travelled 12,350
kilometres in the car and spent a total of $3,250 at her local service station on
petrol. She also made a direct payment of $550 to SS Ltd as a contribution
towards the other running costs of the car. SS Ltd pays all other expenses
associated with the car, including the lease costs totalling $9,900.
4. On 2 November 2021 SS Ltd gave Lauren a computer tablet to use during
client meetings. Lauren estimated she uses the tablet 80% of the time for work
purposes, and the rest of the time to check her personal email and social
media accounts. The computer tablet cost $1,320.
5. On 8 November 2021, SS Ltd reimbursed Lauren $440 for the cost of having
her 2020/21 income tax return prepared by a registered tax agent.
6. In December 2021, SS Ltd gave Lauren and the other consultants a $220
bottle of wine each to celebrate the end of a busy year.
Assume that:
All amounts include GST, where applicable, and that SS Ltd is registered for
GST.
SS Ltd has not made any elections in respect of any fringe benefits provided to
Lauren.
Lauren has provided SS Ltd with all necessary receipts and declarations.
LAWS7012 2022 S1 Practice Exam
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(a) LAWS7012 2022 S1 Practice Exam Question 13 (a)
YOU ARE REQUIRED TO CALCULATE THE FRINGE BENEFITS TAX PAYABLE, if any, by
SS Ltd for the 2021/22 FBT year.
In your answer, ensure that you:
Clearly identify with reference to the law the category of each fringe benefit (including
whether it is an in-house or external benefit),
Show all calculations including formulas,
Provide reasons for your answers including explanations for any exemptions or reductions
applied to taxable values,
Where a benefit is not exempt, explain whether it is a Type 1 or 2 fringe benefit, and
Cite relevant sections of the Fringe Benefits Tax Assessment Act 1986.
Present your answers in a four-column table with the following headings. To insert a table, use
the icon in the answer block:
Fringe benefit Taxable
value
Gross
up
Taxable
amount
$ $
LAWS7012 2022 S1 Practice Exam
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Type your answer here
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Maximum marks: 7
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(b) LAWS7012 2022 S1 Practice Exam Question 13 (b)
Calculate the NET GST REFUNDABLE to SS Ltd in relation to Lauren’s work entitlements. Your
answer must address each of Lauren’s work entitlements. Show all your calculations and
provide reasons for your answers.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Item description GST payable or
(ITC refundable)
Law and explanations
$
Type your answer here
Format
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Words: 0
Maximum marks: 3
1/26
Academic Integrity Pledge
Academic Integrity is a core value at UQ. We all need to act with courage to take our
responsibilities seriously and uphold honesty, trust, respect and equity, particularly in assessment.
For you as a student this means:
completing your assessment tasks, whether face-to-face or online, in an honest, fair and
trustworthy manner;
acting responsibly, based on your lecturer or tutor’s instructions, and not giving or receiving
any unauthorised assistance to others in completing assessment tasks;
commitment to act honestly and refusing to take any action that would break trust with your
peers and lecturer/tutor.
By undertaking this online assessment you will be deemed to have acknowledged UQ’s Academic
Integrity Pledge (above) and to have made the following declaration:
“I certify that my submitted answers are entirely my own work, that I have only used the permitted
resources detailed on the course site in completing this assessment item, and that I have neither
given nor received any unauthorised assistance on this assessment item”.
Instructions to Students
This is a timed open book online invigilated exam. You are not permitted to use any
electronic device other than the computer that you use to sit this exam. You must abide by
the requirements to sit an Inspera exam that are available on the course site on Blackboard.
Answer all questions.
Duration is 120 minutes plus 10 minutes planning time.
There is NO additional 15 minutes of upload time as the exam submits instantly when you
press ‘Submit now’ (on the last page of the exam).
At the end of the total exam duration, you must press ‘Submit now’ to submit your exam. If
you complete your exam before the end of the exam duration and submit, you cannot return
to your exam to update answers or make any amendments, even if you do so before the
end of the total exam duration. Submitting your exam is final.
If you are still working at the end of the total exam duration, you will be taken to the summary
page and prompted to ‘Submit now’. You will not be able to keep writing or modify your
answers once the time for the exam period has elapsed.
LAWS7012 2022 S1 Practice Exam
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Part A - Multiple Choice Questions
This section consists of 10 multiple choice questions (Question 1 - 10) worth 1
mark each for a total of 10 marks.
Please choose the best alternative.
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1 LAWS7012 2022 S1 Multiple Choice Question 1
Homelife Pty Ltd designs and manufactures quilted bedspreads, which they sell at wholesale
prices to retailers. The company provides you with the following information in relation to the
manufacture and sale of their bedspreads:
Total purchases of materials during the 2021/22 income year: $150,000
Total sales of bedspreads during the 2021/22 income year: $500,000
Twenty bedspreads at a total cost of $1,500 were donated to a local homeless shelter (note
the organisation running the homeless shelter is not a deductible gift recipient). The market
value of these bedspreads amounts to $3,000.
STOCK VALUES
STOCK ON HAND 1 July 2021 30 June 2022
Completed bedspreads ready for sale $26,000 $32,000
Partly completed bedspreads $12,000 $14,000
Fabric $44,000 $45,000
Padded filling materials $8,000 $9,000
In relation to the information provided above, which one of the following statements is
FALSE?
[A] Homelife Pty Ltd will be entitled to claim a deduction under section 8-1 of the ITAA97 for
the purchase of the materials used to manufacture their bedspreads.
[B] Homelife Pty Ltd will assessed on their sales income under section 6-5 of the ITAA97.
[C] Homelife Pty Ltd will not be entitled to a deduction under Div 30 of the ITAA97 for their
donation to the homeless shelter as the shelter is not a deductible gift recipient.
[D] Homelife Pty Ltd will have an assessable year-end adjustment under section 70-35 of
the ITAA97.
[E] Homelife Pty Ltd will be assessed on the cost of the bedspreads given to the homeless
shelter under section 70-90.
Maximum marks: 1
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2 LAWS7012 2022 S1 Multiple Choice Question 2
Vinh is a car dealer and holds cars in his business as trading stock. During the current income
year Vinh decides to sell his private vehicle through his business. He purchased the vehicle for
$35,000 in 2016 and its market value is now $20,000.
Which of the following statements is MOST correct?
[A] In accordance with 70-90, Vinh’s business will be deemed to have acquired his vehicle
at its market value of $20,000.
[B] In accordance with section 70-110, Vinh’s business will be deemed to have acquired his
vehicle at its cost of $35,000.
[C] In accordance with section 70-30, Vinh’s business can choose whether to acquire his
vehicle at its cost or its market value.
[D] If Vinh elects to start holding his private vehicle as trading stock at its cost price, there
may be CGT consequences on the disposal of his vehicle to his business.
[E] There will be no tax consequences under the trading stock provisions in relation to Vinh
selling his private vehicle through his business.
Maximum marks: 1
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3 LAWS7012 2022 S1 Multiple Choice Question 3
Susan Jones runs a childcare centre, which is registered for GST. The centre purchases $330
(including GST) of cleaning products from a national supplier for use in its premises. The supplier
provides Susan with a tax invoice for the purchase.
In respect of the purchase of the cleaning products, which one of the following statements
is most CORRECT?
[A] The childcare centre cannot claim any input tax credits on the purchase of the cleaning
products because childcare is a GST-free supply.
[B] The childcare centre can claim an input tax credit of $30 on its purchase of the cleaning.
[C] The childcare centre cannot claim any input tax credits on the purchase of the cleaning
products because childcare is an input taxed supply.
[D] The childcare centre can claim an input tax credit of $33 on its purchase of the cleaning
products.
[E] The cleaning product supplier should not have charged any GST to the childcare centre
on the supply of its cleaning products as childcare centres make GST-free supplies.
Maximum marks: 1
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4 LAWS7012 2022 S1 Multiple Choice Question 4
Which one of the following expenses is MOST likely to be deductible under section 25-10 of
the Income Tax Assessment Act 1997 as a repair?
[A] The cost of purchasing a replacement glass jug for an expensive blender machine used
in a hotel bar. The bartender had been careless when using the original glass jug to make a
frozen cocktail in the blender by allowing the cocktail to run down the outside of the jug,
which made the handle slippery thus causing him to drop it on the tiled floor where it
smashed into pieces.
[B] The cost of replacing a blender machine in a café with a new one after the motor in the
former blender machine burnt out due to overuse.
[C] The cost of replacing a granite benchtop in a family home after the heat from the family’s
air fryer caused the benchtop to crack.
[D] The cost of purchasing a dough hook as an additional accessory for a benchtop mixer
used in a café. Having the dough hook will allow the café’s cook to start baking fresh bread
on site for use in the café’s dishes.
[E] The cost of replacing the heating element in a commercial oven used in a bakery. The
bakery purchased the oven second-hand for a bargain price as the original heating element
had worn out, and the seller was going out of business and did not want to spend money on
repairing it before selling it.
Maximum marks: 1
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5 LAWS7012 2022 S1 Multiple Choice Question 5
An environmental research company is tasked with undertaking research in Australia on the
environmental impacts of climate change. The company owns five caravans, which it allows their
employee environmental scientists to use as temporary accommodation while away on research
trips in remote areas.
The provision of the caravans for the employees’ use would fall into which category of
fringe benefit?
[A] Expense payment fringe benefit.
[B] Residual fringe benefit.
[C] Car fringe benefit.
[D] Property fringe benefit.
[E] Loan fringe benefit.
Maximum marks: 1
6 LAWS7012 2022 S1 Multiple Choice Question 6
Which one of the following items provided to an employee by their employer is NOT an
eligible work-related item under s 58X of the FBTAA86?
[Assume that all items are used primarily by the employee for work purposes].
[A] An iPhone.
[B] A laptop computer.
[C] A fluoro safety vest.
[D] A calculator.
[E] A car.
Maximum marks: 1
LAWS7012 2022 S1 Practice Exam
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7 LAWS7012 2022 S1 Multiple Choice Question 7
Tina Green has set up the Green Family Trust (a discretionary trust), with Scarlet Ltd as the
trustee of the trust.
Given that due to an oversight no beneficiary is presently entitled to $10,000 of the 2021/22
income year net income of the trust, which one of the following statements is CORRECT?
[A] No income tax will be payable on the $10,000 of net income as no beneficiary is
presently entitled to it.
[B] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $3,000 in income
tax on the $10,000 of net income as Scarlet Ltd is a company.
[C] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $4,500 in income
tax on the $10,000 of net income.
[D] As trustee of the Green Family Trust, Scarlet Ltd, will be liable to pay $4,700 in income
tax on the $10,000 of net income.
[E] Tina Green will be personally liable to pay income tax on the $10,000 of net income at
her appropriate marginal tax rate because Tina was the person who set up the Green Family
Trust.
Maximum marks: 1
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8 LAWS7012 2022 S1 Multiple Choice Question 8
Wei, Cheng and Jing co-own a residential investment property together. They each contributed
equally to the cost of the property but as Wei and Cheng have no dependents whilst Jing has three
young children, they decided that the net rental income from the property should be distributed as
follows:
Wei: 20%
Cheng: 30%
Jing: 50%
If the net rental income for the current income year is $30,000, what amount should WEI
include in his assessable income in the current income year in respect of the rental of this
property?
[A] $6,000
[B] $9,000
[C] $10,000
[D] $15,000
[E] $24,000
Maximum marks: 1
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9 LAWS7012 2022 S1 Multiple Choice Question 9
Which one of the following would be most likely to be treated as a depreciating asset under
section 40-30 of the Income Tax Assessment Act 1997?
[A] Land used for farming.
[B] A farm shed.
[C] A tractor used on a farm.
[D] A rock retaining wall built on farmland.
[E] A combine harvester machine held by a farm equipment retailer as trading stock.
Maximum marks: 1
LAWS7012 2022 S1 Practice Exam
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10 LAWS7012 2022 S1 Multiple Choice Question 10
Janet, a resident of Australia for tax purposes, sold a block of vacant land $500,000 under a
contract dated 12 June 2022, with the settlement date being 20 July 2022. In relation to the sale,
Janet incurred solicitor’s fees of $1,000 and a real estate agent’s commission of $9,000.
Janet purchased the land for $250,000 under a contract dated 20 April 2010, with settlement
occurring 24 May 2010. In relation to the purchase of the property, Janet incurred solicitor’s fees
of $1,000 and transfer duty (stamp duty) of $19,000.
Originally Janet had intended to build a house on the land and move into it as her main residence.
However, this never eventuated so the land remained vacant over Janet’s ownership period.
Janet had to borrow money from the bank to fund the purchase of the land and incurred a total of
$50,000 in interest over her ownership period. Janet also incurred a total of $40,000 in council
rates. Janet was unable to claim a tax deduction for either of these costs.
In relation to the facts about Janet, which one of the following statements is TRUE?
[A] The resulting capital gain or capital loss from the disposal of the land should be included
in Janet’s net capital gain for the 2022/23 income year.
[B] The total value of the incidental costs that can be included in the cost base is $30,000.
[C] For CGT purposes, Janet’s acquisition date for the block of land is 24 May 2010.
[D] The $90,000 in interest and council rates that Janet incurred over her ownership period
cannot be included in the cost base as the block of land is a personal use asset.
[E] As Janet had the intention to build a house on the land, she can disregard the capital
gain on the sale of the land under the main residence exemption.
Maximum marks: 1
Part B - Problem Questions
This section consists of three problem questions in parts (Question 11 - 13).
Marks are as indicated in each question for a total of 50 marks.
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(a) LAWS7012 2022 S1 Practice Exam Question 11 Statement (a)
If a taxpayer makes a capital loss on the disposal of their personal jewellery, they can use that
capital loss to reduce any type of capital gains that they might have.
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11 QUESTION 11
For each of the statements on the right [Statement (a) - (e)] indicate whether the
statement is TRUE or FALSE and give a brief EXPLANATION for your answer
citing relevant legislation, case law or rulings as appropriate.
LAWS7012 2022 S1 Practice Exam
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(b) LAWS7012 2022 S1 Practice Exam Question 11 Statement (b)
Employees are entitled to claim a general deduction under section 8-1 of the ITAA97 for their
childcare costs where the provision of the childcare enables them to gain or produce their
employment income free from the restraint of looking after their children.
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(c) LAWS7012 2022 S1 Practice Exam Question 11 Statement (c)
In calculating the ‘net income’ of a partnership under section 90 of the ITAA36, a salary paid to a
partner is deductible.
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Maximum marks: 2
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(d) LAWS7012 2022 S1 Practice Exam Quesetion 11 Statement
(d)
If there is trust income to which no beneficiary is presently entitled, then that portion of trust
income will not be subjected to income tax as it has not been distributed to anyone.
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(e) LAWS7012 2022 S1 Practice Exam Question 11 Statement (e)
One of the many benefits of using a discretionary trust to carry on a family business is that the
income tax burden can be legitimately minimised by splitting the trust income such that all family
members, including young children, are entitled to an equal share.
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LAWS7012 2022 S1 Practice Exam
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12 QUESTION 12
General details
Manjula is a 32-year-old financial planner who is employed by a large financial
planning firm based in Brisbane. Manjula is single and does not have any
dependents. Note that Manjula is an Australian resident for tax purposes and does
not have private health insurance.
For the 2021/22 income year Manjula received a PAYG payment summary from her
employer containing the following details:
Gross salary payments $87,000
Allowance $1,000
Reportable fringe benefit amount (RFBA) $3,962
Reportable employer superannuation contribution (RESC) $10,000
Total tax withheld (PAYG credits) $21,632
Work-related expenses
Manjula is required to present herself well at work, and to maintain a
professional image by wearing suitable business attire. During the 2021/22
income year, Manjula spent a total of $2,750 (including GST) on clothes (such
as blouses, skirts, and jackets) and shoes to wear at work. Manjula has also
spent $385 (including GST) on having her suit jackets and skirts dry-cleaned.
On 22 December 2021 Manjula paid $1,320 (including GST) for her annual
Financial Planning Association of Australia (FPA) membership fee. The fee
covers Manjula’s membership to the FPA for the 2022 calendar year (1
January 2022 to 31 December 2022). Note that the $1,000 allowance that
Manjula received is in recognition of this annual expense.
Manjula often completes some of her work from home in the evenings and on
the weekends as she finds it more convenient to work from home than to
travel into her workplace out-of-hours. She has a home office area set up in
her rented apartment for this purpose. Manjula kept a diary for a representative
4-week period to record her hours of usage and found that she used her home
office for 37 hours over that 4-week period. Note that Manjula pays $380 per
week in rent for her apartment and took two weeks of annual leave over the
2021/22 income year.
Manjula spent $140 (including GST) on a new bookcase for her home office as
she needed extra storage space for her financial planning journals and
reference books. The effective life of the bookcase is 10 years.
Manjula uses her own laptop computer when working from home. She bought
her current laptop computer on 28 June 2021 but did not get around to taking it
out of the box and setting it up until 1 July 2021. The laptop computer cost
$1,650 (including GST) and has an effective life of 2 years. Manjula reliably
estimates that she uses the laptop computer for work purposes 80% of the
time.
Over the 2021/22 income year, Manjula incurred $3,500 (including GST) in
mobile phone and internet expenses; however, her employer has reimbursed
LAWS7012 2022 S1 Practice Exam
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her in full for these expenses (note that Manjula’s reportable fringe benefit
amount relates to this reimbursement). Manjula reliably estimates that 40% of
her phone and internet expenses are work-related.
Manjula attended the annual Financial Planning Association of Australia (FPA)
conference, which was held in Brisbane from 4 to 6 March 2022. The
registration fee cost $1,850 (including GST). Attendance at the conference
enables Manjula to keep up to date with developments in her field and to
network with her peers. For each of the three days of the conference, Manjula
travelled by public transport to the conference location at the Brisbane
Convention Centre from her apartment and back again. This travel amounted
to a total cost of $20 (including GST).
Other expenses
Manjula made two cash donations during the 2021/22 income year:
- She donated $250 to the Breast Cancer Network Australia (BCNA). Note that
the BCNA
is a deductible gift recipient.
- She donated $2,000 to a registered Australian political party.
Investment property
Manjula and her brother Suresh purchased an investment property located on the
Sunshine Coast as ‘tenants in common’, each with a 50% ownership interest in the
property. They signed the contract to buy the property in June 2021, with the
settlement date being 29 July 2021. The seller provided them with the builder’s
certificate stating that the construction cost of the house was $280,000. Since
purchasing the property, Manjula and Suresh have continued to rent it to the existing
tenants at $500 per week.
During the 2021/22 income year, Manjula and Suresh have incurred the following
costs in relation to the property (note that they have met each of the expenses
equally):
Stamp duty on the purchase of the property $22,000
Legal fees on the purchase of the property $3,000 (incl. GST)
The property cost $600,000 and to meet the purchase price, Manjula and
Suresh contributed $50,000 each towards the deposit, and borrowed the
remaining $500,000 from a bank under a 30-year loan term. The loan was
taken out on 29 July 2021. In relation to the loan, they incurred the following
expenses:
- Loan establishment fees $2,500
- Valuation fees (for loan approval) $2,000
- Lender's mortgage insurance $9,500
- Interest payments $15,964
- Repayments of principal $9,500
Council rates $2,200 (incl. GST)
LAWS7012 2022 S1 Practice Exam
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Property insurance (29 July 2021 – 28 July 2022) $990 (incl. GST)
Property management fees ($50 per week) $2,400 (incl. GST)
On 1 March 2022, there was a bad hailstorm on the Sunshine Coast, which
resulted in all the windows on one side of the house being broken. Manjula and
Suresh arranged for the windowpanes to be replaced on 2 March 2022 at a
cost of $1,400 (including GST). Unfortunately, their property insurance
excluded hailstorm damage, so they did not receive any insurance proceeds in
relation to this.
Further information
All expenses can be substantiated.
The Commissioner’s fixed rate for home office running costs is $0.52/hour for
the 2021/22 income year. Alternatively, the rate for the ATO’s shortcut method
is $0.80/hour for the 2021/22 income year.
In relation to any capital allowances, Manjula would like to use the diminishing
value method. She does not have a low value pool and does not wish to start
one.
In relation to any capital works deductions, use the 2.5% rate.
LAWS7012 2022 S1 Practice Exam
20/26
(a) LAWS7012 2022 S1 Practice Exam Question 12 (a)
Calculate Manjula and Suresh’s NET RENTAL INCOME OR LOSS for the 2021/22 income
year. Ensure that you provide full workings and explanations, and that you specify section
references to the ITAA97 or ITAA36 and relevant case law decisions to support your
calculations.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Description Amount Law and explanations
$
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Maximum marks: 13
LAWS7012 2022 S1 Practice Exam
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(b) LAWS7012 2022 S1 Practice Exam Question 12 (b)
Calculate Manjula’s TAXABLE INCOME for the 2021/22 income year. Note that you will need to
complete Part (a) of this question before starting this calculation. Ensure that you provide full
workings and explanations, and that you specify section references to the ITAA97 or ITAA36
to support your calculations.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Description Amount Law and explanations
$
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Maximum marks: 14
LAWS7012 2022 S1 Practice Exam
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(c) LAWS7012 2022 S1 Practice Exam Question 12 (c)
Identify whether Manjula is liable to pay the MEDICARE LEVY SURCHARGE for the 2021/22
income year, and if so, calculate the value of that liability. Note that you will need to complete
Parts (a) and (b) of this question before starting this calculation. Ensure that you provide full
workings.
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Maximum marks: 3
LAWS7012 2022 S1 Practice Exam
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13 QUESTION 13
Lauren is employed as a Senior Consultant at Strategic Solutions Pty Ltd (SS Ltd), a
business advisory company located in Brisbane. During the 2021/22 income year,
her employment remuneration package consisted of the following:
1. Cash salary $120,000
2. Superannuation guarantee contributions $11,400
3. A car provided by SS Ltd for Lauren’s personal use and to travel to various
clients’ premises. SS Ltd leases this car under a contract commencing on 30
January 2021. The value of the leased car at the commencement of the
contract was $44,000. During the 2021/22 FBT year, Lauren travelled 12,350
kilometres in the car and spent a total of $3,250 at her local service station on
petrol. She also made a direct payment of $550 to SS Ltd as a contribution
towards the other running costs of the car. SS Ltd pays all other expenses
associated with the car, including the lease costs totalling $9,900.
4. On 2 November 2021 SS Ltd gave Lauren a computer tablet to use during
client meetings. Lauren estimated she uses the tablet 80% of the time for work
purposes, and the rest of the time to check her personal email and social
media accounts. The computer tablet cost $1,320.
5. On 8 November 2021, SS Ltd reimbursed Lauren $440 for the cost of having
her 2020/21 income tax return prepared by a registered tax agent.
6. In December 2021, SS Ltd gave Lauren and the other consultants a $220
bottle of wine each to celebrate the end of a busy year.
Assume that:
All amounts include GST, where applicable, and that SS Ltd is registered for
GST.
SS Ltd has not made any elections in respect of any fringe benefits provided to
Lauren.
Lauren has provided SS Ltd with all necessary receipts and declarations.
LAWS7012 2022 S1 Practice Exam
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(a) LAWS7012 2022 S1 Practice Exam Question 13 (a)
YOU ARE REQUIRED TO CALCULATE THE FRINGE BENEFITS TAX PAYABLE, if any, by
SS Ltd for the 2021/22 FBT year.
In your answer, ensure that you:
Clearly identify with reference to the law the category of each fringe benefit (including
whether it is an in-house or external benefit),
Show all calculations including formulas,
Provide reasons for your answers including explanations for any exemptions or reductions
applied to taxable values,
Where a benefit is not exempt, explain whether it is a Type 1 or 2 fringe benefit, and
Cite relevant sections of the Fringe Benefits Tax Assessment Act 1986.
Present your answers in a four-column table with the following headings. To insert a table, use
the icon in the answer block:
Fringe benefit Taxable
value
Gross
up
Taxable
amount
$ $
LAWS7012 2022 S1 Practice Exam
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LAWS7012 2022 S1 Practice Exam
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(b) LAWS7012 2022 S1 Practice Exam Question 13 (b)
Calculate the NET GST REFUNDABLE to SS Ltd in relation to Lauren’s work entitlements. Your
answer must address each of Lauren’s work entitlements. Show all your calculations and
provide reasons for your answers.
Present your answers in a three-column table with the following headings. To insert a table, use
the icon in the answer block:
Item description GST payable or
(ITC refundable)
Law and explanations
$
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Maximum marks: 3
