Rebecca runs a business of purses and bags for women in Figtree shopping centre for many years. The business incurred a number of transactions during March 2022. All figures include GST where applicable:

 

Purchases purses and bags on credit	46,000
Cash purchases of purses and bags	10,300
Cash sales purses and bags	55,500
Credit sales purses and bags	75,500
Operating expenses paid in cash (all including GST)	22,200

 

 

Requirement (Part A)

Calculate the net GST payable (or refundable) to the ATO for the month, assume that the taxpayer uses the accrual basis reporting method.                                                                                       

 

 

Part B

 

Jessica was provided with a motor vehicle which cost her employer $77,000 (inclusive of GST and luxury car tax) on 1 April 2021. Jessica travelled 22,000 kilometres during the 2020-2021 FBT year, of which 14,000 kilometres were for employment purposes. Her employer is registered for GST and claims input tax credits on the motor vehicle. The running costs of the motor vehicle were $1,900, out of which Jessica contributed $300.

 

 

Jessica's employer also provided her with a $150,000 loan at a fixed rate of 2% interest. The principal will be payable in full in 2026. She used half of this loan to purchase an investment property, and the remaining half was spent on holidays with her family. 

 

 

Requirement (Part B)

Calculate the employer's total FBT liability for the benefits provided to Jessica for the 2020-2021 FBT year. Using the statutory method for the car fringe benefit. The deemed market interest rate for the 2020-2021 FBT year is 4.80%.              

Answer rating: 100% (QA)

Part A Calculation of Net GST Payable To calculate the net GST payable or refundable to the Australian Taxation Office ATO for the month we need to de... View the full answer