Fireman Marc Marc is an Australian resident for tax purposes. He is 39 years of age, single and is

CASE STUDY 1 (35 Marks)

Fireman Marc Marc is an Australian resident for tax purposes. He is 39 years of age, single and is employed as a fireman. Marc received the following amounts during the year ending 30 June 2016: (i) Salary from his employer: $48,000. (ii) 15 Days annual leave owing to her which had accrued since May 2014: $2,500. (iii) An annual allowance of $1,000 towards travel expenses. (iv) Compensation payments due to injuries sustained in an industrial accident as follows: a. Workers compensation: $1,000 × 5 weeks $5,000 b. Compensation for loss of his right hand: $35,000 c. Social security disability support pension: 7 weeks $1,000 (v) Interest from the Bank of America Term Deposit Account held in America: $850. This amount is after 15% tax has been withheld by the Bank of America. (vi) Cash: $500 and an expensive bottle of Whisky from his co-workers as a get well gesture. During the year his employer has deducted $11,500 in PAYG withholdings from his salary and workers compensation payment. On the other hand, Marc spent $500 on firefighting gear and has kept all necessary documentation to support this expenditure. This expense will constitute a deduction. Required: Calculate the net income tax payable or refund due to the taxpayer for the 2015/2016 tax year. State the specific taxation rules relevant to the above events to support your arguments and calculations. Page 5 of 5 ACC3TAX /Taxation Maria Zito La Trobe University CASE STUDY 2 (25 Marks) The Case of Jane Nobles Jane Nobles aged 56 was employed by the CheeseCake Shop for 14 years as a pastry cook. On 1 April 2016 Jane received a genuine redundancy package of $85,000 from her employer due to a business restructure. She also received a payment of $5,600 in lieu of annual leave on the termination of her employment. After a month holiday in the Greek Islands Jane decided to start a cake decorating business and signs a lease with a monthly rental of $2,500. To encourage her to sign a long term lease the property manager of the building offered her a rent free period of six months. Requirements: a) Determine whether the above events are assessable during the year ending 30 June 2016? Ensure you state the specific legislation, tax rulings and case law to support your answer. b) Calculate the amount of tax to be withheld by the employer due to the termination of her employment. [23 + 2 = 25 marks] Detailed Grading Criteria (10 marks) [10 Marks] Achievement 9-10 Marks 7-8 Marks 5-6 Marks 4 Marks Structure and organisation Structure and sequence are used effectively to help integrate ideas or support logical argument. Soundly structured throughout. Ideas are sequenced in a logically satisfying way; connections between different themes or sections are well made. Sequence and structure are logical and easy to follow. Introductory and concluding sections used effectively. Well enough structured to make sense; could be better organised and more tightly focused upon the topic. Instances of irrelevance or confusion. Use of language and adherence to academic conventions Powerful, confident and precise use of language; mastery of style and tone. Near perfect acknowledgement of sources throughout the paper. Language used demonstrates precision and expressiveness as well as clarity. Evidence of appropriate citation of work. Language is generally sound and clear throughout. Some evidence of appropriate citation of work. Clear enough to be understood; some confused or unclear expression. Spelling, punctuation & grammar generally satisfactory but likely to need attention