What are the liabilities of dragon taxation services

Assignment Help Taxation
Reference no: EM13492237

Students are required to answer the following question. The essay must be fully referenced with in text citations and a bibliography.

You assisted Pamela to prepare her income tax return in 2009 when you were employed as an accountant for Dragon Taxation Services Pty Ltd. At that time your supervisor told you to ignore a transaction that Pamela mentioned which involved income of $220,000 being paid from a business in India to a bank account in Hong Kong. It seemed to you at the time that as Pamela was living in Australia at that time that this money was taxable income. However after your boss told you to ignore it you did not mention it again and you did not talk to Pamela about it. You signed the 2009 income tax return and lodged it with the Australian Taxation Office (ATO).You resigned from that company shortly afterwards and set up your own accounting business which you still operate. At all times you were a registered tax agent.

Last week Pamela's solicitors contacted you. They informed you that she has been contacted by the ATO which has amended her assessment for 2009 and included the $220,000. As a result she has to pay extra income tax of $105,000 plus penalties and interest totalling $195,000. She has also incurred legal and accounting fees of $15,500 already in negotiating with the ATO about this problem. The solicitors claim that this is all your fault and have demanded that you pay the monies owing to the ATO and reimburse Pamela for her legal and accounting costs.

What are the liabilities of Dragon Taxation Services Pty Ltd and your former supervisor and you? You should discuss responsibilities under the common law (i.e in negligence and contract). You will need to consider vicarious liability of the employer. If it is possible to argue successfully with the ATO about the amended assessment and penalties and interest, how will that affect your liability ?

You will also need to consider the liabilities that arise because of the specific laws that cover tax agents. This would include liability to Pamela and any possible problems with your tax agents licence.

Reference no: EM13492237

Questions Cloud

Determine the orbital period of the faster planet : Two newly discovered planets follow circular orbits around a star in a distant part of the galaxy. What is the orbital period of the faster planet, in years
Should the 5-alarm chili line be discontinued : Quinton Corporation produces and sells two types of chili: 1-Alarm and 5-Alarm. Operating performance for the most recent quarter is.
Explain the mole fractions of each component in a mixture : What are the mole fractions of each component in a mixture of 5.10 g of O2, 7.44 g of N2, and 1.26 g of H2. O2 N2 H2 (b) What is the partial pressure in atm of each component of this mixture if it is held in a 13.70-L vessel at 12°C O2 atm N2 atm ..
Determine the speed at which the satellite travels : A satellite is in a circular orbit about the earth (M = 5.98 x 1024 kg). The period of the satellite is 6.84 x 104 s. What is the speed at which the satellite travels
What are the liabilities of dragon taxation services : What are the liabilities of Dragon Taxation Services Pty Ltd and your former supervisor and you? You should discuss responsibilities under the common law
What is the variable cost per unit : Buchanan Enterprises has projected its income before taxes as follows.
Find the hydrostatic force on the gate : A gate in an irrigation canal is in the form of a semi-circle with radius of 4m(straight side on top). Find the hydrostatic force on the gate
Explain the partial pressure of each component pn2 atm ph2 : A mixture of gases contains 1.35 g of N2, 2.64 g of H2, and 2.38 g of NH3. If the total pressure of the mixture is 1.64 atm, what is the partial pressure of each component. PN2 atm PH2 atm PNH3 atm
How to assume independent situations : If the variable costs per client per week are decreased by $2, how many clients are needed each 15-week period to break even?

Reviews

Write a Review

Taxation Questions & Answers

  What is pheasants current e and p

In calculating its taxable income for the year, Pheasant claimed an $8,000 deduction for the organizational expenses. What is Pheasant's current E & P?

  Matt king sells a rental house on 1st january 2012 and

matt king sells a rental house on 1st january 2012 and receives 130000 cash and a note for 55000 at 10 percent

  Describe and contrast the deficits projected

Describe and contrast the deficits projected under the baseline and alternative fiscal scenario and the implications of the projections based on the CBO report.

  What is the recognized gain and the basis for the bonds

Taxpayer receives stock as a gift from his nephew. The adjusted basis of the stock is $10,000 and the fair market value is $30,000. Taxpayer trades the stock for bonds with a fair market value of $25,000 and $5,000 cash. What is his recognized gai..

  Tax results by selling the assets in different tax years

Could Wanda achieve better tax results by selling the assets in different tax years?

  How the taxable value of these fringe benefits

Determine whether the following benefits are fringe benefits or exempt fringe benefits and, where applicable, the relevant category of fringe benefit. Provide reasons for your answer.

  What percentage decline in earningsbefore interest and taxes

Natural Selection's liabilities-to-equity ratio Times interest earned ratio Times burden covered What percentage decline in earnings before interest and taxes could Natural Selection have sustained before failing to cover: Interest payment req..

  Nancy gave her grandson sean twenty acres of land her tax

nancy gave her grandson sean twenty acres of land. her tax basis in the land was 25000. nancys marginal tax rate for

  Compute janice morgan federal income tax payable

Janice did not keep a record of the sales tax she paid. The amount from the sales tax table is $437 and compute Janice Morgan=s 2011 Federal income tax payable

  Minimize taxable income and maximize net income

Denton wants to minimize taxable income and maximize net income reported to stockholders.

  What would the tax rate need to be in year

What would the tax rate need to be in Year 2 to make the taxpayer indifferent?

  Advise periwinkle of its fbt consequences

How would your answer to (a) differ if Emma used the $50,000 to purchase the shares herself, instead of lending it to her husband and advise Alpha of the income tax consequences arising out of the above information for the 2013-14 income year.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd