First scenario

You are a Senior Tax Accountant working at Azure Beach Accountants and Financial Services (ABAFS) and you have been asked to provide advice on the varying tax treatment for a client, Mark Smith, who is considering the purchase of a parcel of light industrial land. You will need to explain the treatment of capital gains tax on the disposal of assets in the following entities:

1. Partnership
2. Company
3. Trust
4. Superannuation

Mark Smith owns a business with an income of $200,000. Mark is married to Zoe, and they have 2 children aged 13 and 15 years old.

You will need to research and provide advice on each of the above entities and the treatment of Capital Gains in order to review with your supervisor.

Prior to the role play, you must undertake research to prepare for the meeting with your supervisor. You can find further information on CGT cost base and capital gain or loss for the sale of investments in your textbook or at the following links:

• calculating your CGT -ATO website
• cost base of assets -ATO website
• CGT discount -ATO website

Required: Complete your notes in the space below.

NOTES

Treatment of Capital Gains

Partnership

Company

Trust

Superannuation

Second scenario

Role of the student being assessed

You are meeting with your supervisor, Sally Walker, the Senior Tax Partner at ABAFS, to discuss the treatment of capitals gains that you have prepared for the client. During the role play you should do the following:

• conduct the meeting in a professional manner and demonstrate appropriate protocols
• make sure that you present and run through your notes. You should demonstrate your knowledge of CGT, cost base calculations and discount eligibility during the discussion with your supervisor
• seek advice from your supervisor if you are not sure of particular items
• ask appropriate questions to confirm the information in your notes.

Role/s of the person/s in supporting roles

In this role play you will play Sally Walker, Senior Tax Agent at Azure Beach Accountants and Financial Services (ABAFS), the supervisor/mentor of the participant. You should do the following:

• ask the student to explain the treatment of capital gains under each different entity
• confirm that the student has fully explained the treatment
• check if the student is unsure of any information in their notes
• check if there are any outstanding issues or uncertainties.

Third scenario

You are a Senior Tax Accountant working at Azure Beach Accountants and Financial Services (ABAFS) and you are ready to meet with the client to provide advice on the varying tax treatment on the disposal of assets in the following entities:

1. Partnership
2. Company
3. Trust
4. Superannuation.

Role of the student being assessed

Use your notes and any additional information you obtained from your supervisor to:

• explain to the client the differing tax treatment under each entity
• advise the client of any relevant tax obligations and that any advice from taxation authorities is to be followed including that tax office enquiries must be responded to and there is an obligation to meet taxation audit requirements, when applicable, in a timely manner
• respond to client's questions.
• Effectively participate in verbal exchange using active listening and questioning techniques to elicit, clarify and confirm information from the client.
• Select and use appropriate conventions and protocols when communicating with the client to explain the CGT treatments.
• Reassure the client that you and ABAFS will assist in following ATO advice or requests for information.

Role/s of the person/s in supporting roles

You play the client role, Mark Smith. You are considering the purchase of a parcel of light industrial land and you want the student to explain to you the treatment of capital gains tax on the disposal of assets in the following entities:

1. Partnership
2. Company
3. Trust
4. Superannuation