Several prominent commercial office buildings, which had been constructed by Granitex in the 1970's using aerated concrete at the client's request (for cheaper construction) also recently collapsed. The incident occurred during lunchtime on a weekday and miraculously no-one was injured. However two of Granitex's directors are now facing charges of professional misconduct in relation to the project. During the 2022/23 income year, Granitex incurred $30,000 in legal fees in defending the directors against these claims..

Required: Advise Granitex, Steve and Charles regarding the income tax implications arising from the above facts in relation to the 2022/23 income year. In your answer make sure you refer to any relevant cases, legislative provisions, tax rulings and principles of tax law. HIRAC menthod

Answer rating: 100% (QA)

Issue Granitex Steve and Charles need advice on the income tax implications arising from the collaps... View the full answer