Impact of Capital Gains Taxation

Question: Discuss about the Impact of Capital Gains Taxation. Answer: Introduction: According to the case study, this is observed regarding different methods of payment considering under personal income categories. In reference to the case study, it can be asserted that Hillary had written her book by herself without any help of a ghost writer or anybody else. It can be also referred that she has sold all the manuscripts, rights and photos to the Daily Terror which amounted to $10000 (Woellner et al. 2016). According to the statement of Hillary, she wants to write her own biography to provide proper mental satisfaction to herself. As per the discussed case analysis, it is already mentioned the same by following proper legal procedure. The actual legal procedure for processing the income is basically originated from personal exertion and taxation law. It is mainly considered as salaries, earnings and commission and allowance accordingly. It is recognized that comparison between different employee relation in the specified format and structure. Due to taking into consideration regarding the several facts related to business procession which is based on specific corporate activities. These practices are extremely important due to its account accessibility or partnership of taxpayers. Under the Section 39310 of the Income Tax Assessment Act in the year 1997, it is found that concern business processes are generated on the basis of negotiation by considering income in specific manner(Sourdin et al. 2015). As per the taxation law, income for payments can be measured by any kind of income generated of the business and total earnings of the business will be reserved by the taxpayers. It is based on specific organizational activities related to sale of property by considering the given case study. In the case of law of contracts, the conditions with Daily Terror were established on the basis of aspects where Hillary owns the rights of copywriting. Then, it will be taken into account that the copyright of the story was sold for a price which amounted to $10000. According to the given scenario, the will be made on the basis of specific rewards paid for the related services in the future period of time as per the case of Brent Vs FCT (1971) 125 CLR 418. This discloses that the payment received by Hillary fails to be considered as sale activity and is termed in the form of a normal income with accurate aspects (Christie 2015). Hillary is desired to run her own started business process without writing any story before. Accordingly, with respect to the assumption that concerns, the profits earned by Hillary is for considering it as an ordinary profit for the same aspect. By taking the noteworthy points, in this case, it can be presumed beneath the Act name as S152 of Income Tax Assessment Act in the year 1997 (Long, Campbell and Kelshaw 2016). Normally it is not considered as the payment of services instead it is regarded as the reward for surrendering the copyright activities which will be considered in the coming financial year, these payments comes under the purview of capital gains tax. Further, it can be stated here that, if a particular contract is considered in which Hillary repudiates the title of copyright of the story that was originally vested with Daily Terror. These cases happen mostly in the cases of payment and its related aspects of income in which payments for services are provided. Thus, it will not be considered as below the Section 152 of the Income Assessment Act in the year 1997. It is due to the derivation of profit from normal income. It is barred from assessing from Section 152 (3) of the Income Assessment Act in the year 1997 (Taylor and McNamara 2014). Discussion based on several effects related to assessable income of parent The following case study discloses the importance of an assumption which is to be made for the partial payment worth $50,000 as interest income. This case can be compared with Riches Vs Westminster Bank Ltd in the year 1947 AC 390 at 400. This rate of interest is in relation with expenditures for accounts that the creditor will pay in compliance with the due date. It can be noted here that the amount of $10,000 reflects in the payment division that the son will pay to her mother against the usage of $40,000 after completion of 5 years (Barkoczy et al. 2016). The overall amount of $40,000 was lent for 5 years as a ordinary income in the given agreement are considered as per Section 6(5) of the Income Tax Assessment Act in the year 1997 and generating interest income from those activities within expiration period(Barkoczy 2016). There are several interest fall is consider as per the regular payment in lump sum analysis in future period of time. As per the overall analysis of given case study has been denoted that parents are taking consideration for interest of making payments in daily basis Long, Campbell and Kelshaw 2016). This is the case of an amount that is lent on 5 % interest per annum owing to the amount of $40,000. It is particularly based on the income of ordinary nature which will be in the form of interest against a sum in the most precise form. The argument is being made on the additional sum that is enhanced by the son who is not able to constitute this payment into ordinary income. The ordinary income has been considered under the Section 6(5) which comprises the mandatory separation of loan repayment with the additional rate of 5% which is specifically affordable in terms payable account in future period of time (Berg and Davidson 2016). Its main purpose is to create an understating about the tax exemption for the purpose of future analysis. It permits extra payment of money in the most suitable way. Recognition of Net Capital Gain or Loss in Scotts account during 30th June of a specific financial year by considering case of current tax year The Net capital gain for Scotts account is recognized on several taxation policies and procedure basis. It is generally recognized within 30th June which is considered as current taxation year. Table: Scott (Net Capital Gain or Net Capital Loss) (Source: Created by Author) Difference when Scott would have sold this property for her daughter for $200,000 Table: Scott sold the property to his daughter for $200,000 (Source: Created by Author) It can be concluded after analyzing the above table that Scott has transferred the ownership of the purchased land to his daughter (Robin and Barkoczy 2016). This can be termed as the attributes of sale which is used to determine the value of the property in the market in comparison to the amount which is transferred. Difference if the property was to be owned by a company not any individual Table: Discounted Method (Source: Created by Author) In the above mentioned table, discussion is made about the valuation of income. This table is concerned with the reduced method by the propertys owner to get the benefit for tax exemption (Hegeman and Sureth 2015). On the other hand, consideration of company by the owner for the assessment of income tax when the case comes close to the capital gains under the indexation method. Total capital computes to $2, 22,090. References Barkoczy, S., 2016. Foundations of Taxation Law 2016. OUP Catalogue. Barkoczy, S., Nethercott, L., Devos, K. and Richardson, G., 2016. Foundations Student Tax Berg, C. and Davidson, S., 2016. Submission to the House of Representatives Standing Committee on Tax and Revenue Inquiry into the External Scrutiny of the Australian Taxation Office. Christie, M., 2015. Principles of Taxation Law 2015. Hegemann, A., Kunoth, A., Rupp, K. and Sureth, C., 2015.Impact of capital gains taxation on the holding period of investments under different tax systems(No. 183). arqus-Arbeitskreis Quantitative Steuerlehre. Long, B., Campbell, J. and Kelshaw, C., 2016. The justice lens on taxation policy in Australia. St Mark's Review, (235), p.94. Robin and Barkoczy 2016. 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