Daniel and Gabby arrived back in Perth on the 23 rd March 2023 from a holiday in
Question:
Daniel and Gabby arrived back in Perth on the 23rd March 2023 from a holiday in Italy they had been delayed from their original date due to a horrid virus.It is now their intention to purchase an importing business in Perth which is for sale by ABC Pty Ltd.
The cost of the business is $250,000 plus GST and is broken down into the following components.
Goodwill $150,000
Stock $ 27,500
Plant and Equipment $ 50,000
Licence to import goods $ 22,500
Settlement for the purchase of the business took place on 24th April 2023 and was bought in the name of D & G Importers (a partnership).
The offices and warehouses that ABC Pty Ltd leased from XYZ Pty Ltd were put on the market in May 2023 at a price of $752,500 (inclusive of GST) and as Daniel and Gabby thought renting was a waste of money, they decided to purchase the property. The purchase was finalised on the 13th June 2023. The unimproved value of this property is $430,178.
Once the business was up and running Daniel and Gabby decided to purchase some new motor vehicles for use in the business. Daniel acquired a Holden Commodore on the 1 May 2023 for $55,000 and Gabby a pink Holden Astra (convertible) for $35,000 from Phoenix Motors.The third-party insurance was $110 and $95 respectively.
Daniel and Gabby met with their insurance broker to discuss insurance on all their new assets.
The following payments were made -
Motor Vehicles $1,354
Building $3,478
Stock $1,963
Plant and Equipment $ 851
Workers Compensation $11,967 (for employees)
On the 29th June 2022 Daniel and Gabby purchased an apartment in Fremantle for $325,790 (unimproved value $216,985) prior to this they lived at home with their parents and had not previously purchased a home. They paid cash for the apartment. When they left for their holiday on 1 January 2023, they let Daniel's brother Jake live in the apartment for $350 per week. On their return they moved back into the apartment and now use the apartment 45% for business purposes in relation to the importing business.
Required
Calculate the stamp duty and land tax applicable for the year ended 2023 and advise who is liable for its payment. Provide legislative references to support your answer and provide an explanation for any items you exclude from your calculations.
You should group all similar items - e.g. Transfer duty, vehicle duty, and insurance.
Management Accounting Information for Decision-Making and Strategy Execution
ISBN: 978-0137024971
6th Edition
Authors: Anthony A. Atkinson, Robert S. Kaplan, Ella Mae Matsumura, S. Mark Young