Question

12:04 MO * YONG ... ..ll 48%. X H16028 Individual Assignment T... H16028 Individual Assignment T1 2020.p... HIG00 Taxation Theory, Practice and Law Individual Assignment T2 2000 Assignments' Instructions and Requirements Question 1 (10 Marks) Perisher Pty Ltd (Perisher) is a Ski equipment manufacturer that operates around Mt Hotham in Victoria. On 1 May 2019, Perisher provided Nikita (one of its employees) with a car as Nikita does a lot of travelling for work purposes. However, Nikita's usage of the car is not restricted to work only, Perisher purchased the car on that date for $44,000 (including GST) plus $2,000 (including GST) dealer delivery charges. For the period of 1 May 2019 to 31 March 2020, Nikita travelled 12,000 kilometers in the car and incurred expenses of $770 on minor repairs that have been reimbursed by Perisher. The car was not used for 10 days when Nikita was interstate and was parked at the airport and for another five days when the car was scheduled for annual repairs Calculate the Fringe Benefits Tax Liability for Perisher, please have a look at the matrix below on how to answer the question QUESTION 1: Calculate the Fet liability for Perisher Pty Ltd Identification of material tacts (issues) regarding fringe benefits provided to Nikita Identification and analysis of legal issues / legal question and relevant taxation law in regards to fringe benefits (eg FBTAA 1986). Thorough application of tax law (e... ITAA 1936 and ITAA 1997) to material facts in Perisher's Weighting 19 1% 1% 5% Accurate conclusion of the FST calculation Correct information and taxation law have been used and properly cited. A detailed analysis has been performed QUESTION 1 TOTAL MARKS 10 % HIGO28 Taxation Theory, Practice and Law Individual Assignment T2 2020 QUESTION 2 - (15 MARKS) o

Answer 1

Fringe benefit taxes are paid by employer if he provides extra benefits for one of its employees.

Car value = purchase price + dealer delivery charges = $44000+$2000 =$46000

No. Of days service is provided to employee is from 1st May 2019 to 31st March 2020 =304 days

Fringe Tax chargeable at 30% = $46000*30%*304/365-770 = $109723.7

As per given table rates

Taxable value =0.2 *Base value 46000*304/365 - 770 = $6892.24

Fringe tax liability  is 6892.24*10% = $689

The car is treated as private use but it is not available at employees premises and next time at work shop for maintenances.

Thus at this both cases of parking at airport and repair shop it can be considered as car available for private uses.

Available for private uses = 10+5 =15 days.