Johnsons Pty Ltd (Invest), an Australian base rate investment-only company, provides you with the following information for the year ending 30 June 2019: Accounting Assignment Help
• On 1 July 2018 Johnson had a balance of $300,000 in its franking account.
• On 15 September 2018 Johnson paid a fully franked distribution of $507,500 to their shareholders.
• On 28 October Johnson paid $250,000 income tax.
• On 30 November 2018 Johnson received a $350,000 distribution from a US company.
• On 15 January 2019, Johnson paid a $290,000 70% franked distribution to its shareholders
• On 21 February 2019, Johnsons paid Diverted Profits Tax of $109,500
• On 24 March 2019, Johnson received a $60,000 tax refund in relation to a previous tax dispute.
• On 28 April Johnson paid $148,000 – $70,000 for its 1st PAYG instalment owing and $78,000 for its 2nd PAYG instalment due, for 2019 financial year.
• On 28 May 2919, Johnson received a 50% partially franked dividend of from Jackson Ltd, a public listed company.
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REQUIRED
PART 1 Prepare Johnson’s franking account for the year ending 30 June 2019.
PART 2 Calculate the amount that Johnsons Pty Ltd could potentially distribute to its shareholders in a new distribution by the end of 30 June 2019 without incurring Franking Deficit Tax.
QUESTION 2 – CAPITAL GAINS/LOSSES, CGT NET CAPITAL GAIN BACKGROUND
Jacques recently retired as he is aged 60, and he intended to move to Port Fairy and build a retirement home. However, his father’s health has become increasingly poor and so he decided to return to France to assist his father. Jacques sets about on a plan to sell all of his assets over 8 months before July 2019, achieving more than $1 million.
It is now September 2020 and Jacques needs to lodge his tax return, but he is concerned about the CGT implications of his assets sales. He is confused about which gains or losses he must declare. You have discussed the matter with Jacques and found the following relevant facts re asset sales. Accounting Assignment Help
(1) Sale of household assets
Jacques received $10,500 for all of his household furniture and effects (which were not antique) from a second hand furniture store.
(2) Sale of car
Jacques sold his car on 30 June 2019 for $11,999 as a private sale. He had bought it for $39,999 on 1 July 2010.
(3) Shares
Jacques sold ANZ shares on 30 May 2019 for $36,500, which were purchased in June 2016 for $41,500. Jacques sold shares in SmallCo Pty Ltd for $31,000, which were purchased in March 1992 for $11,000.
(4) Port Fairy land sale
Jacques sold a block of vacant land at Port Fairy in July 2019 for $325,000 and had entered into the contract on 1 June 2019. The block was sold as he no longer needed it for retirement and his plans to return to France. The land was purchased on 21 August 2018 for $255,000 and acquisition costs amounted to $13,000. Conveyancing fees and commission amounted to $18,000. Other costs in holding the land amounted to $12,000 including interest, and rates for council and water.
(5) Prior year capital losses
Prior year capital losses were $7,000 as advised by Jacques.
REQUIRED
Part 1 For the 2019 income year, advise the capital gains (or losses) for each of the various transactions outlined above.
Part 2 Calculate the net capital gain for Jacques to be included in his 2019 income tax return Accounting Assignment Help
