Assessment Instructions This case study must be completed and submitted to during class time. This case study must be prepared as a group effort that requires collaboration and effective teamwork. All students must take part and research the relevant legislation, including cases, and available via the Australian Taxation Office website. Read the following case study carefully and answer all required questions in the Answer Booklet provided via announcement along with this case study data. Only one person from the group needs to submit the answer booklet. Make sure you include all group members' names and student IDs on the cover page. Case Study Your client Edward Clarke has attended your office to have his 2023-year end tax return prepared. Edward is 48 years old, single resident taxpayer living in Adelaide city, employed as a barista by a local caf. Required PART A Calculate Edward's Net Capital Gain. Identify the relevant section reference for any exemption or exclusion. Clearly outline all steps in the calculation. PART B Calculate Edward's Assessable Income. Identify the relevant section reference for each inclusion or exclusion. Clearly show all necessary workings. PART C Calculate Edward's Allowable Deductions. Identify the relevant section references for each inclusion or exclusion. Clearly show all workings. Apply any available alternatives to obtain the maximum deduction available. PART D Calculate Edward's net tax payable or refund due. Clearly show all workings.

RECEIPTS DURING 2022/23 DATE DESCRIPTION $ NOTES Full year Net Wages 44,700 PAYGW totalled $8,900 Full year Rent from property in Melbourne 24,700 Includes $4,000 of rent received for July 2023. Additionally, $2,500 has not been received and is owed by the tenants (this amount is not included in $19,700). Full year Shift allowance 800 Full year Child support from ex-partner 9,000 Full year Tips from customers 40 19/08/22 Dividend from Tea Pot Ltd 5,100 40% franked at 30% tax rate 29/09/22 Reimbursement of work expenses 800 Portable fan purchased for work 07/10/22 Proceeds from sale of shares in Shark Ltd 4,000 Originally purchased in 2010 for $5,000 02/12/22 Dividend from A2 Milk Ltd 750 Fully franked at 30% tax rate 01/02/23 Proceeds from sale of gold ring 900 Originally purchased in 2019 for $1,300 19/04/23 Proceeds from sale of shares in Black Ltd 6,000 Purchased in August 2022 (refer to payments) 28/06/23 Proceeds from sale of furniture 2,000 Originally purchased in 2021 for $11,000. Sold to brother: Market value on Sale was $9,000 OTHER INFORMATION On 1 June 2023, Edward plays national lotto every week and cashed $2,700 from lottery wining. Edward gave his boat to his sister as a gift. The boat had cost Edward $14,000 during January 2022 and the current market value was $15,400.

PAYMENTS DURING 2022/23 - all substantiated unless states otherwise DATE DESCRIPTION $ NOTES Full year Private Hospital Insurance Premiums 3,000 Reduced premium option taken Full year Child care fees 4,500 Necessary to allow Edward to work Full year Parking costs 190 Occasionally he travels to work and park his car near employment place. No receipts kept. Amounts each less than $10 Full year Mobile phone fees 1,200 Records indicate 10% work related 18/08/22 Purchase of shares in Black Ltd 3,000 Sold in April 2023 (refer receipts part) 27/08/22 Purchase of white shirt and black pants 200 Wear only at work. This is company's dress code and compulsory for all baristas 27/09/22 Portable fan costs 800 Employer asked Edward to purchase this for work purposes. Reimbursed by employer (refer receipts part) 01/10/22 Installation of new alfresco 17,000 At rental property 01/10/22 Repair costs to window frame, damaged by tenant 400 At rental property 01/12/22 Payment of annual rates 5,500 $2,500 for private residence; $3,000 for rental property 01/04/23 Purchase of laptop 3,000 Effective life of 2 years, 10% work related 09/05/23 Overtime meal 350 On occasion, Edward finishes work late and eats before returning home. OTHER INFORMATION (a) When Edward purchased a rental property in 2009, there were records indicating that the property incurred construction costs of $400,000. (b) Edward paid a tax agent fee of $400 on 31/7/2022. He drove 150 kilometers round trip to his tax agent's office to complete his 2022 tax return.