Which of the following statements are about the various sections of the lecture material on taxation of investments in Australia are TRUE:

1. If an investment is sold and has been held for more than 1 year, then only half of the gain is included in an individual’s assessable income and is taxed at their marginal rate of tax (plus Medicare Levy).
2. If an individual takes out an investment loan to buy an investment using a principal and interest loan, then their entire loan repayment will normally be an allowable deduction.

Sally receives a payment of $1,400 in dividends on her shares in Westpac Bank. She receives this as a direct payment of $1,400 into her nominated bank account. Westpac send her a dividend notice advising that her dividend payment was $1,400 but she also has ‘franking credits’ of $600 for this dividend payment. How much is Sally’s assessable income on these dividends based on the Australian taxation system?

The gains in value from which of the following are LEAST likely to be assessable income in Australia based on the lecture material:

Which of the following statements is LEAST consistent with the section on ‘Personal Income Tax Strategies’ in Australia:

Which of the following statements is LEAST consistent with section on the lecture on ‘Preparing a Tax Return’ and other relevant sections:

Jenny lives in the country of Snowland. Her taxable income is $24,000 per year. Snowland’s income tax schedule is provided below. Snowland also has a 2% Medicare Levy. What is her income tax payable including Medicare Levy (to the nearest dollar)? Please do not include dollar signs or commas in your answer.

Lisa lives in the country of Snowland. She has:

• a part-time job with one employer earning a gross salary of $23,000 per year;
• a casual job with a different employer earning a gross salary of $8,000 per year;
• $13,000 in a 1 year term deposit that will earn interest at the rate of 5% per year; and
• study expenses of $5,000 per year that are an allowable deduction.

What is her taxable income (to the nearest dollar)? Please do not include dollar signs or commas in your answer.

Julie lives in the country of Snowland. She has:

• a full-time job earning a gross salary of $42,000 per year;
• $30,000 in a 1 year term deposit that will earn interest at the rate of 4% per year; and
• study expenses of $1,000 per year that are an allowable deduction.

What is her assessable income (to the nearest dollar)? Please do not include dollar signs or commas in your answer.

David lives in the country of Snowland. He has:

• a part-time job with one employer earning a gross salary of $29,000 per year;
• a casual job with a different employer earning a gross salary of $10,000 per year;
• $19,000 in a 1 year term deposit that will earn interest at the rate of 5% per year; and
• work-related expenses of $2,000 per year that are an allowable deduction.

What is his assessable income (to the nearest dollar)? Please do not include dollar signs or commas in your answer.

Which of the following statements about the ‘Why Pay Tax?’ and ‘Sources and Uses of Tax’ sections of the lecture material are TRUE:

1. A common ‘myth’ about taxation is that most of it goes to paying the salaries of politicians. This myth is false because the majority of government expenditure is on the provision of important services to the community and social security.
2. There is some debate about the ‘right level’ of government involvement in the economy. Some argue that the government can solve problems in the economy better than the private sector and so advocate a larger role for government. Others advocate that excessive government involvement tends to create inefficiencies over the long-term.