Identify the issues raised and the relevant legislation

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Reference no: EM13339536

Part A

Explain why the payment to the taxpayer in FCT v Dixon (1952) 86 CLR 540 was assessable income but the payment in Scott v FCT (1966) 117 CLR 514 was not.

In your answer you should include (but not necessarily be limited to) the following:

i) A brief statement in your own words of the facts of the cases.

ii) Identify the issues raised and the relevant legislation in the context of ITAA97.

iii) Identify any cases and other sources of information relevant to the issues and legislation.

iv) Apply the law to the facts stating clearly why one taxpayer was assessable and the other was not.

Part B

Nigel is a professional percussionist and performs with a number of bands and orchestras. In order to practice, he set aside a special room in his house that is soundproof and contains a variety of electronic sound equipment. The room is used only for practice or performance related purposes. He pays council rates, interest on the house mortgage, repairs and maintenance telephone and electricity expenses in connection with the house. He believes he should be able to claim tax deductions for all these costs together with depreciation on the room and equipment.

Explain the tax position to Nigel. In you answer you should:

i) Identify the tax issues that are raised and the relevant sections of the legislation.

ii) Identify any cases and other sources of law or information that apply.

iii) Apply the law to the facts.

iv) Express a conclusion in regard to the issues identified and indicate any other information required.

Reference no: EM13339536

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