QUESTION 5

a) Is income earned from illegal means (e.g. drug-dealing, insider trading or theft) assessable income?

b) Calculate the assessable income of a resident taxpayer in the current year if they were to be in receipt of $500 bank interest from their savings account, $10,000 won at the Crown Casino, $2,000 rent earned from a boarder sharing a house. Give reasons, considerations and quote reference to sections of the ITAA in your answer.

c) Would a $500 allowance paid to an employee by an employer be assessable income to the employee. Explain your answer.

d) Calculate the Medicare payable for a resident individual with a taxable income of $20,000, $24,900 and $100,000

e) Calculate the gross tax payable for the taxable income of $25,000, $40,000 and $95,000. (Note Gross tax payable is the amount of tax due before Medicare levy and tax offsets)

REQUIRED:

Answer each question above giving consideration to the allocated marked.