HI6028 Taxation, Theory, Practice &LawT1, 2017ASSIGNMENT 1Due date:Week 7Due date: Week 8 ( Block...

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HI6028 Taxation, Theory, Practice &LawT1, 2017ASSIGNMENT 1Due date:Week 7Due date: Week 8 ( Block Mode)Maximum marks: 20 (20%)Instructions: This assignment is to be submitted by the due date in both soft-copy(Safeassign–Bb).NO hard copy assignment will be accepted.The assignment is to besubmitted in accordance with assessmentpolicy stated in the Subject Outline and Student Handbook.It is the responsibility of the student submitting the work to ensurethat the work is in fact his/her own work.Ensure that whenincorporating the works ofothers into your submission that itappropriately acknowledged.Case study 1: Residence and sourceKit is a permanent resident of Australia. He was born in Chile and retains his Chileancitizenship. Kit spends most of the year working off thecoast of Indonesia on an oil rigfor a United States company. He was recruited for this job in Australia and signed acontract with the company here. For the last four years, Kit’s wife has lived in Australiawiththeir two children. They purchased a homein Australia three years ago. Kit and hiswife have a jointbank account with Westpac Bank. Kit’s salary is paid directly into hisaccount. All of the family’s other investments, including a share portfolio that generatesdividend income, remain in Chile.Kit gets one month offfrom work every third monthand, on these occasions, he meets with his family either in Australiaor on holidaysaroundSouth America (usually in Chile where his parents reside).Discuss whether Kit is a resident of Australia and how his salary and investmentincomewould be taxed (10 marks, max. 1000 words).Case study 2: ordinary incomeExplanations of the respective outcomes reached by the courts in the following cases whichallinvolving salesof land:I.Californian CopperSyndicate Ltd v Harris (Surveyor of Taxes XXXXXXXXXXTC 159II.Scottish Australian Mining Co Ltd v FC of T XXXXXXXXXXCLR 188III.FC of T v Whitfords Beach Pty Ltd XXXXXXXXXXCLRIV.Statham & Anor v FC of T89 ATC 4070V.Casimaty v FC of T97 ATC 5135VI.Moana Sand Pty Ltd v FC of T88 ATC 4897VII.Crowv FC of T88ATC4620VIII.McCurry & Anor v FC of T98 ATC XXXXXXXXXXmarks, max. 1000 words).

David · Accepted Answer

Case Study 1- 
The income earned by an individual is liable to be taxed as per the Australian tax laws. There 
are laid down laws that define the manner of taxation of the income of the person or entity 
assessed to tax.  
To determine the tax liability in Australia on the income that is earned by an individual or a 
company the most important factor to be determine is if that person is an Australian or 
foreign resident for tax purposes. The Australian tax laws do not use the same criteria as is 
used by Department of Immigration and Border Protection for determining the residency for 
tax purposes. This makes the following things significant:  
 A person can be a resident for tax purposes even without being a citizen of Australia 
or a permanent resident 
 A person may not be a resident of Australia even if he has an Australian VISA. 
There are some tests that need to be done so as to determine the residency status of a person 
for Australian tax purposes: 
 Resides test: The term 'resides' is not defined within income tax legislation, the courts 
and the ATO rely on the normal definition of this term while deciding about who is an 
Australian resident for income tax purposes. 
The Shorter Oxford Dictionary defines reside as: 
'...to dwell permanently, or for a considerable time, to have one's settled or usual 
abode, to live, in or at a particular place...' 
 The domicile test: One is an Australian resident if his domicile i.e., the place that is 
his permanent home is in Australia. 
 The 183-day test: If a person is actually present in Australia for more than half the 
income year, whether continuously or with breaks, he may be said to have a 
constructive residence in Australia. 
In the given case,

HI6028 Taxation, Theory, Practice &LawT1, 2017ASSIGNMENT 1Due date:Week 7Due date: Week 8 ( Block Mode)Maximum marks: 20 (20%)Instructions: This assignment is to be submitted by the due date in both...

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