Tax issues and relevant sections of the legislation


Assignment

Part A

Describe why the payment to the taxpayer in FCT v Dixon (1952) 86 CLR 540 was assessable income but the payment in Scott v FCT (1966) 117 CLR 514 was not.

In your answer you must include the following:

i) A short statement in your own words of the facts of the cases.

ii) Identify the issues raised and relevant legislation in the context of ITAA97.

iii) Identify any cases and other sources of information relevant to the issues and legislation.

iv) Apply the law to the facts stating clearly why one taxpayer was assessable and the other was not.

Part B

Nigel is a professional percussionist and performs with the number of bands and orchestras. In order to practice, he set aside a special room in his house which is soundproof and contains a number of electronic sound equipment. The room is used only for practice or performance related purposes. He pays council rates, interest on house mortgage, repairs and maintenance, electricity and telephone expenses in connection with the house. He believes he must be able to claim tax deductions for all these costs together with depreciation on the room and equipment.

Describe the tax position to Nigel. In you answer you must:

i) Identify the tax issues which are raised and relevant sections of the legislation.

ii) Identify any cases and other sources of law or information that apply.

iii) Apply the law to the facts.

iv) Express a conclusion in regard to issues identified and indicate any other information required.

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Taxation: Tax issues and relevant sections of the legislation
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