Kit is a permanent resident of Australia. He was born in Chile and retains his Chilean citizenship....

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Kit is a permanent resident of Australia. He was born in Chile and retains his Chilean citizenship. Kit spends most of the year working off the coast of Indonesia on an oil rig for a United States company. He was recruited for this job in Australia and signed a contract with the company here. For the last four years, Kit’s wife has lived in Australia with their two children. They purchased a home in Australia three years ago. Kit and his wife have a joint bank account with Westpac Bank. Kit’s salary is paid directly into his account. All of the family’s other investments, including a share portfolio that generates dividend income, remain in Chile. Kit gets one month off from work every third month and, on these occasions, he meets with his family either in Australia or on holidays around South America (usually in Chile where his parents reside). Discuss whether Kit is a resident of Australia and how his salary and investment income would be taxed (10 marks, max. 1000 words). Case study 2: ordinary income Explanations of the respective outcomes reached by the courts in the following cases which all involving sales of land: I. Californian Copper Syndicate Ltd v Harris (Surveyor of Taxes XXXXXXXXXXTC 159 II. Scottish Australian Mining Co Ltd v FC of T XXXXXXXXXXCLR 188 III. FC of T v Whitfords Beach Pty Ltd XXXXXXXXXXCLR IV. Statham & Anor v FC of T 89 ATC 4070 V. Casimaty v FC of T 97 ATC 5135 VI. Moana Sand Pty Ltd v FC of T 88 ATC 4897 VII. Crow v FC of T 88 ATC 4620 VIII. McCurry & Anor v FC of T 98 ATC XXXXXXXXXXmarks, max. 1000 words)
	
Document Preview: HI6028 Taxation, Theory, Practice & 
Law 
 
T1, 2017 ASSIGNMENT 1

Due date: Week 7 
Due 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 be submitted in accordance with assessment 
policy stated in the Subject Outline and Student Handbook. 
 
It is the responsibility of the student submitting the work to ensure 
that the work is in fact his/her own work. Ensure that when 
incorporating the works of others into your submission that it 
appropriately acknowledged.Case study 1: Residence and source 
 
Kit is a permanent resident of Australia. He was born in Chile and retains his Chilean 
citizenship. Kit spends most of the year working off the coast of Indonesia on an oil rig 
for a United States company. He was recruited for this job in Australia and signed a 
contract with the company here. For the last four years, Kit’s wife has lived in Australia 
with their two children. They purchased a home in Australia three years ago. Kit and his 
wife have a joint bank account with Westpac Bank. Kit’s salary is paid directly into his 
account. All of the family’s other investments, including a share portfolio that generates 
dividend income, remain in Chile. Kit gets one month off from work every third month 
and, on these occasions, he meets with his family either in Australia or on holidays 
around South America (usually in Chile where his parents reside). 
 
Discuss whether Kit is a resident of Australia and how his salary and investment income 
would be taxed (10 marks, max. 1000 words).

Case study 2: ordinary income 
 
Explanations of the respective outcomes reached by the courts in the following cases which 
all involving sales of land:  
I. Californian Copper Syndicate Ltd v Harris (Surveyor of Taxes XXXXXXXXXXTC 159 
II. Scottish Australian Mining Co Ltd v FC of T XXXXXXXXXXCLR 188...

David · Accepted Answer

1 
Running Header: Residence and source 
 
 
According to the 9995-1 ITAA95, a person will be treated as an Australian resident if he is a 
resident for the purpose of ITAA36. For the individuals to be an Australian resident should 
include below mentioned four characteristics: 
(i) Resident test 
(ii)  Domicile test 
(iii) 183-day test and  
(iv) Superannuation test  
Main source of revenue within Australian taxation system is the Income tax which for the 
individual taxpayers can be levied on the three sources namely personal income (includes 
salaries), capital gains and business income. The tax rates for the resident individual taxpayers 
and non-resident taxpayers are different. In the present case it is to be determined that whether 
Kit is resident of Australia or not and how the salary and the investment income of the Kit would 
be taxed.  
Residential status  
For calculating Individual’s personal tax liability on income earned during year it is necessary to 
determine the resident status. In the present case Resident status in Australia is to be determined 
for which Residential test is to be applied which are as below: 
(I) Any person who is residing in the Australia will be considered for the tax purpose as 
the Resident and all of his income earned will be also taxed in the Australia only. If 
this is satisfied then no other test will be required. 
2 
Residence and source 
 
(II) If above condition is not satisfied then the application of second test will be required. 
For second test, if any of three below mentioned test is satisfied then the person will 
be considered Australian Resident- 
(a) Domicile Test- If person is domicile i.e. the permanent residence of the person is in the 
Australia then he will be considered Australian resident, until and unless proved that 
permanent residence of person is outside Australia 
(b) Residing Days (183 days) test- If person is residing for more than the 183days in 
Australia,

Kit is a permanent resident of Australia. He was born in Chile and retains his Chilean citizenship. Kit spends most of the year working off the coast of Indonesia on an oil rig for a United States...

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