Reference no: EM132211386

Question: Amber owned and operated a boutique chocolate shop in Sydney that she purchased for $240,000 in August 2010. The purchase price consisted of equipment and stock worth $110,000 and the balance being goodwill. Following the birth of her child, Amber decided to sell the shop in February 2018 for $440,000 of which $280,000 was attributed to goodwill.

Amber was also required to sign a contract restricting her from opening another similar business within a 20km radius for the next 5 years. She received an additional sum of $50,000 for this contract.

Due to their expanding family, Amber and her husband purchased a four bedroom home in the outer suburbs of Sydney in June 2018. The purchase was partly funded by the sale of the business but also by the sale of Amber's one bedroom inner-city apartment. Amber had lived in the apartment since she inherited it from her Uncle in October 2013. He had purchased it in September 1992 for $180,000 and lived in it until he died. At the time of his death the apartment was valued at $390,000. Amber signed a contract for the sale of the apartment in May 2018 for $550,000 and settlement took place in July 2018.

Required: Advise Amber of the taxation consequences of these transactions. You are not required to calculate any capital gains or losses. (20 marks)

You should use the ILAC style of essay writing for this assignment

2. Do not re-state the question as part of your answer. This often gets repeated in the 'issue' section, however that is incorrect.

3. Use in-text referencing. Do not use footnotes.

4. Names of cases or statutes should be italicised, and followed by the jurisdiction not in italics, for example: Acts Interpretation Act 1901. Note the abbreviation for ‘Commonwealth' is ‘Cth' not ‘Cwlth'.

5. Do not start a new line simply because you are starting a new sentence.

6. Start each paragraph on a new line, and leave a clear line gap after the preceding paragraph. Don't make your paragraphs too long.

7. You must end your assignment with a bibliography that is divided into three separate parts, listing statutes, cases and books / articles / on-line Modules.

This assessment task will assess the following learning outcomes:

• be able to identify and explain the rules of law relating to taxation law topics covered in the subject.

• be able demonstrate a capacity to engage in legal research.

• be able to use legal research skills to apply the law to legal problems relating to taxation so as to reach a solution.

• be able to analyse legal rules so as to differentiate between possible outcomes to the legal issues arising from novel fact situations.