Taxation Law According to ITAA 1997 and ITAA 1936 CGT Speech or Presentation

Taxation Law According to ITAA 1997 and ITAA 1936 CGT - Speech or Presentation Example Hence these shares would be treated as if acquired by Les for $ 20,000, their market value on 1.4.2004, the date of his father’s death and not the $ 15,000 originally paid by his father on 10 August 2001. 7. Block of land: The block of land was purchased on 1 March 2000 for $ 130,000 and sold on 20 June 2010 for 150,000 resulting in a net CGT of 20,000 (H). Although the settlement proceeds were received on 10 August 2010 in the next financial year they would be taxable as on 30 June 2010 as the asset is considered sold or disposed off in the year the taxpayer loses its ownership. 8. Dividend income from certain shares was $ 5,200 with the imputation credits being $ 2,229. Here the taxpayer is eligible as a small shareholder as his imputation or franking credits are less than $ 5,000. Hence, net taxable income is $ 5,200 - $ 2,229 = $ 2971 (I) Under the dividend reinvestment the shareholder can choose to receive newly issued shares instead of divident. Such a plan is treated as if the shareholder received the actual dividend and then used the money to buy shares. The dividend is taxed like any other dividend (including with any  dividend imputation), and the shares are taken to be acquired for the cash one didnt receive. Dividend imputation is a corporate tax under which some or all of the share paid by the corporate may be attributed or ‘imputed’ to the shareholder by giving him tax credits so as to reduce the tax burden and avoid ‘double taxation’. These credits are called franking credits which the company gives to the shareholder at the time of paying dividend. Under dividend imputation small shareholders are exempt upto $ 5000 and franking credits are fully refundable. An eligible shareholder receiving a franked dividend declares the cash amount plus the franking credit as income, and is credited with the franking credit against their