James Gutherson an Australian resident taxpayer sold the following assets during the 2020/21 tax year. ASSET PURCHASE
Question:
James Gutherson an Australian resident taxpayer sold the following assets during the 2020/21 tax year.
ASSET | PURCHASE COST $ | ACQUISITION DATE | DISPOSAL DATE | SALE PRICE $ |
Brown Ltd shares | 12,000 | 31-May-85 | 01-Dec-20 | 44,500 |
Campbell Ltd shares | 6,800 | 01-Apr-06 | 01-Nov-20 | 9,000 |
Lexus (Car) | 80,000 | 12-Oct-04 | 10-Mar-21 | 74,000 |
Vacant land in Greece (see note 1) | 30,000 | 01-Oct-01 | 25-Jun-21 | 45,000 |
Investment apartment in Cronulla | 130,000 | 05-Dec-88 | 05-Jul-20 | 210,000 |
Painting | 25,000 | 01-Nov-07 | 30 April-21 | 22,000 |
Racehorse | 12,000 | 01-Dec-08 | 31-May-21 | 145,000 |
Note 1:
- Additional costs of owning the land in Greece are:
- Interest on loan to purchase the land $2,000
- Rates and taxes to Federal government $1,500
- James did not claim a tax deduction for these costs.
Other information:
James also had $40,000 of capital losses (from share sales) from the 2019/20 tax year to be brought forward.
James’s only other income was $4,200 of fully franked dividends from EFAT Ltd.
Expenses that James incurred were:
- Subscription to Investor Magazine to maintain and increase his investing knowledge $210 (receipts held)
- Purchase of the Financial Review newspaper to monitor share prices – 100 newspapers @$1.30 each (no receipts held)
Required Calculate James’s Taxable income for the year ended 30 June 2021
Expert Answer:
Capital gains Brown Ltd shares 44500 12000 32500 Campbell Ltd shares 9000 6800 2200 Vacant lan... View the full answer
