Max Lowe is a 37 year old Australian resident for income tax purposes. Max has two children with his spouse, Lara (33 years old) - Craig (aged 3 years) and Troy (aged 1 year old). Lara’s 2019 taxable income is comprised solely of $12,300 in gross salary she received from part-time employment.
On October 15, 2018 Max resigned from his position as a Senior Lecturer in Marine Biology at the University of Newcastle, NSW. On leaving the University Max was successful in obtaining employment as a Marine Biologist with the Australian government science organisation (CSIRO) based in Cairns, Queensland. He and his family moved permanently to Cairns to commence his employment on 1 November, 2018. Max is also the sole owner of a Sydney rental property that was tenanted for the whole year.
Details of Max’s receipts and payments for the year ended 30 June 2019 are as follows (all amounts are inclusive of GST where applicable):
Receipts
Gross Salary - University of Newcastle note 1 $32,750
Gross Salary – CSIRO note 2 $88,000
Received Fully Franked Dividend (ASX Listed) $3,500
Received Unfranked Dividend $1,300
Gross Rental Property Income $10,400
Net Interest Income from New Zealand note 3 $1,800
Payments made by Max
Airfares and accommodation costs relating
to the initial job interview with CSIRO $1,860
Annual subscription Australian Marine Biology Society $700
Purchase of equipment note 4 $4,399
Expenses relating to the rental property (all deductible) $17,100
Other amounts – all deductible under s8-1 $1,500
Deductible Superannuation Contribution paid
to Max’ Superannuation Fund note 5 $3,500
Superannuation Contribution paid to Lara’s
Superannuation Fund note 5 $4,500
Other information:
Notes:
PAYG Tax Deducted $10,000
Reportable Fringe Benefits $3,700
PAYG Tax Deducted $28,000
Reportable Fringe Benefits $3,200
Reportable Employer Superannuation Contributions $5,900
1/8/18 Computer $3,200 effective life 5 years (used 80% for business)
1/05/19 Microscope $910 effective life 10 years (used 100% for business)
1/06/19 Binoculars $289 effective life 3 years (used 100% for business)
5. On the 20 June 2019 Max paid $3,500 from his after tax salary to his superannuation fund and advised the fund this was a concessional superannuation contribution. On the same day he also paid $4,500 to Lara’s superannuation fund, on her behalf, and advised her superannuation fund this was not a concessional contribution. The only other concessional contributions received by Max’s fund for the year were the Reportable Employer Superannuation Contributions ($5,900) and Superannuation Guarantee contributions from both employers.
Required
Calculate Max’s minimum taxable income and net tax payable/refundable for the year ended 30 June 2019.
Reportable Fringe Benefit | $6900 |
Reportable Employer Superannuation Contributions | $ 5,900 |
Received Unfranked Dividend | $1,300 |
Net Interest Income from New Zealand note 3 | $1,800 |
Gross Rental Property Income | $10,400 |
Superannuation Contribution paid to Lara’s | $4,500 |
$24900 | |
Concession | |
HELP (HECs) debt of $7,200 | $7200 |
Superannuation Contribution paid to Max | $3,500 |
Airfares and accommodation costs relating | |
to the initial job interview with CSIRO | $1860 |
Annual subscription Australian Marine Biology Society | $700 |
Purchase of equipment note 4 | $3,999 |
Expenses relating to the rental property (all deductible) | $17,100 |
Other amounts – all deductible under s8-1 | $1,500 |
$35,859 | |
Max Minimum Taxable Income Hence Max Minimum Taxable income is $-10959 and Next tax refundable to him will be $ 10959 |
$-10,959 |
Max Lowe is a 37 year old Australian resident for income tax purposes. Max has two...
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