Mr Pierre Boulet is a famous French chef who moved from Paris to Melbourne in October...

 

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Mr Pierre Boulet is a famous French chef who moved from Paris to Melbourne in October 2016 to work for an Australian fine dining restaurant. Since then, he has been leasing a unit in South Yarra, but he maintained some of his investments at the local branch of his French bank - the BNP Paribas, in Paris. During the 2019/20 year, he received a total of e4,250 in interest which was paid into the local branch of his BNP Paribas account (15% withholding tax was paid in France). On 2 July 2018 Pierre purchased a vintage car for $35,000. The vehicle was sold at auction in August 2019 for $55,000. With the proceeds from the car, Pierre purchased a painting for $35,000 and two stamps for $980 (individual prices were $510 and $470). Both purchases were in August 2019. On 15 September 2019 he sold his old apartment in Paris that he had owned since 2000. He made a profit of e 100,000 on that sale. Pierre never repatriated or declared any part of the interest or the profit realised on the sale of his Parisian apartment in his Australian tax return. In April 2020 he sold the painting for $45,000 and the two stamps for $9,000 - one of the stamps sold for $5,200 and the other for $3,800). Pierre has always declared in his Australian tax returns all salaries received from his Australian employer, as well as profits from his Australian investments. For the year 2019/20 his salaries amounted to $230,000. On 5 October 2020, Pierre received a notice of amended assessment, which included the amounts derived in France in his taxable income. Assume that you are a tax consultant, and Pierre has approached you for advice on the following matters: a) Under what circumstances and on what grounds could the ATO issue such an (5 marks) amended assessment? b) What should Pierre do if he decides to dispute this amended assessment, and what time limits would apply? c) What would be the extent of his liability to income tax for the year ended 30 June (4 marks) 2020. (4 marks) d) He has already booked plans to go on a cruise to Europe in early November 2020, and will not be back in Sydney till the end of April 2021. Would it make a difference if he pays the outstanding tax in mid-May 2021? (5 marks) Prepare a report advising Pierre on these matters. (2 marks) Mr Pierre Boulet is a famous French chef who moved from Paris to Melbourne in October 2016 to work for an Australian fine dining restaurant. Since then, he has been leasing a unit in South Yarra, but he maintained some of his investments at the local branch of his French bank - the BNP Paribas, in Paris. During the 2019/20 year, he received a total of e4,250 in interest which was paid into the local branch of his BNP Paribas account (15% withholding tax was paid in France). On 2 July 2018 Pierre purchased a vintage car for $35,000. The vehicle was sold at auction in August 2019 for $55,000. With the proceeds from the car, Pierre purchased a painting for $35,000 and two stamps for $980 (individual prices were $510 and $470). Both purchases were in August 2019. On 15 September 2019 he sold his old apartment in Paris that he had owned since 2000. He made a profit of e 100,000 on that sale. Pierre never repatriated or declared any part of the interest or the profit realised on the sale of his Parisian apartment in his Australian tax return. In April 2020 he sold the painting for $45,000 and the two stamps for $9,000 - one of the stamps sold for $5,200 and the other for $3,800). Pierre has always declared in his Australian tax returns all salaries received from his Australian employer, as well as profits from his Australian investments. For the year 2019/20 his salaries amounted to $230,000. On 5 October 2020, Pierre received a notice of amended assessment, which included the amounts derived in France in his taxable income. Assume that you are a tax consultant, and Pierre has approached you for advice on the following matters: a) Under what circumstances and on what grounds could the ATO issue such an (5 marks) amended assessment? b) What should Pierre do if he decides to dispute this amended assessment, and what time limits would apply? c) What would be the extent of his liability to income tax for the year ended 30 June (4 marks) 2020. (4 marks) d) He has already booked plans to go on a cruise to Europe in early November 2020, and will not be back in Sydney till the end of April 2021. Would it make a difference if he pays the outstanding tax in mid-May 2021? (5 marks) Prepare a report advising Pierre on these matters. (2 marks)

Answer rating: 100% (QA)

a There is only ever one assessment for a particular tax period whether initiated by us or you Any change to an assessment results in an amendment An ... View the full answer