TAX QUIZ - Taxation Quiz PDF

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QUIZ 1 Question 11 out of 1 points In Australia, individuals pay tax at progressive rates. (Ch 1)Selected Answer: TrueCorrect Answer: Tru e Question 21 out of 1 points Australia's general jurisdictional rules are based on the 'world-wide' rather than the 'territorial' approach to income taxat...

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QUIZ 1



Question 1 1 out of 1 points In Australia, individuals pay tax at progressive rates. (Ch 1)



Selected Answer:

True

Correct Answer:

e

Tru

Question 2 1 out of 1 points Australia's general jurisdictional rules are based on the 'world-wide' rather than the 'territorial' approach to income taxation. (Ch 1)



Selected Answer:

True

Correct Answer:

e

Tru

Question 3 1 out of 1 points

The GST is an example of an indirect tax. (Ch 1) Selected Answer: Correct Answer:



True Tru e

Question 4 1 out of 1 points Match the following taxes with their tax base. (Ch 1)



Question Correct Match

Selected Match

GST

A. Taxable supplies

A. Taxable supplies

FBT

B. Fringe benefits taxable amount

B. Fringe benefits taxable amount

Income tax

C. Taxable income

C. Taxable income

Question 5 1 out of 1 points Which of the following terms best describes the principle underlying the notion that if A derives $100,000 of income and B derives $30,000 then A should pay more tax than B? (Ch 1)

Selected Answer:

Vertical equity

Correct Answer:



Vertical equity

Question 6 1 out of 1 points Which of the following are primary sources of tax law? (Ch 2)

Selected Answers:

Tax legislation Case law

Correct Answers:

Tax legislation Case law

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Question 7 1 out of 1 points What is the hierarchy of courts (from 1 lowest to 3 highest) in the Australian federal tax jurisdiction? (Ch 2)



Correct Answer

Selected Answer

1. Federal Court

1. Federal Court

2. Full Federal Court

2. Full Federal Court

3. High Court

3. High Court

Question 8 1 out of 1 points Because of Section 55 of the Commonwealth Constitution, Commonwealth tax laws are traditionally contained in several different Acts. (Ch 3)



Selected Answer:

True

Correct Answer:

e

Tru

Question 9

1 out of 1 points Show the following tax reforms in their order of introduction. (Ch 4)



Correct Answer

Selected Answer

1. Medicare Levy

1. Medicare Levy

2. Capital gains tax

2. Capital gains tax

3. Fringe benefits tax

3. Fringe benefits tax

4. Dividend imputation

4. Dividend imputation

5. GST

5. GST

Question 10 1 out of 1 points Which of the following is not one of the activities of the Australian Taxation Office (ATO)? (Ch 6) Selected Answer:

Correct Answer:

Enacting legislative provisions

Enacting legislative provisions

QUIZ 2

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Question 1 1 out of 1 points Which of the following marginal rates is not a part of the progressive rates schedule for resident individuals? Selected Answer:

30 %

Correct Answer:



30 %

Question 2 1 out of 1 points A company's income year is the previous financial year.



Selected Answer:

True

Correct Answer:

e

Tru

Question 3 1 out of 1 points A resident individual with taxable income of $85,000 in 2018/19 faces a marginal tax rate of 37%.



Selected Answer:

False

Correct Answer:

e

Fals

Question 4 1 out of 1 points Which of the following is an example of statutory income?

Selected Answer:

Correct Answer:



Capital gains from the sale of shares

Capital gains from the sale of shares

Question 5 1 out of 1 points Which of the following sets of provisions were part of the Tax Law Improvement Project's instalment rewrites of provisions in the ITAA36 into the ITAA97?

Selected Answers:

Capital gains tax provisions Core provisions Trading stock provisions

Correct Answers:

Capital gains tax provisions Core provisions Trading stock provisions



Question 6 1 out of 1 points Which of the following form part of both 'income for surcharge purposes' and 'repayment income'? Selected Answers:

Reportable superannuation contributions for the income year Taxable income for the income year Total net investment loss for the income year

Correct Answers:

Reportable superannuation contributions for the income year Taxable income for the income year Total net investment loss for the income year

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Question 7 1 out of 1 points The private health insurance tax offset is a refundable tax offset.



Selected Answer:

True

Correct Answer:

e

Tru

Question 8 1 out of 1 points

The Medicare Levy Surcharge is payable on a taxpayer's income for surcharge purposes for the year.



Selected Answer:

False

Correct Answer:

e

Fals

Question 9 1 out of 1 points Amounts collected under the PAYG system are credited against a taxpayer's actual tax liability for the year.



Selected Answer:

True

Correct Answer:

e

Tru

Question 10 1 out of 1 points To which of the following payments would the PAYG instalment regime apply? Selected Answers:

A taxpayer's business income. Corporate income.

Correct Answers:

A taxpayer's business income. Corporate income.

QUIZ 3

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Question 1 1 out of 1 points Which of the following is not one of the statutory tests of residency for an individual? Selected Answer:

Citizenship test

Correct Answer:



Citizenship test

Question 2 1 out of 1 points Which of the following cases considered the residency of individuals who were posted/transferred to branch offices overseas? Selected Answers:

FCT v Applegate (1979) FCT v Jenkins (1982)

Correct Answers:

FCT v Applegate (1979) FCT v Jenkins (1982)

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Question 3 1 out of 1 points Which of the following factors should be taken into account when determining the residency of individuals who temporarily leave Australia according to Income Tax Ruling IT 2650? Selected Answers:

the durability of association that the individual has with a particular place in Australia any intention either to return to Australia at some definite point in time or to travel to another country the intended and actual length of the individual’s stay in the overseas country the establishment of a home outside Australia

Correct Answers:

the durability of association that the individual has with a particular place in Australia any intention either to return to Australia at some definite point in time or to travel to another country the intended and actual length of the individual’s stay in the overseas country the establishment of a home outside Australia

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Question 4 1 out of 1 points A company that is incorporated in Australia is a resident of Australia.



Selected Answer:

True

Correct Answer:

e

Tru

Question 5 1 out of 1 points In general, the source of interest income arising from a loan is usually the place where the loan agreement is entered into and the money is lent.



Selected Answer:

True

Correct Answer:

e

Tru

Question 6 1 out of 1 points GST is centred around which two of the following concepts?

Selected Answers:

Claiming input tax credits Charging GST

Correct Answers:

Claiming input tax credits Charging GST

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Question 7 1 out of 1 points GST charged on a taxable supply is an example of exempt income.



Selected Answer:

False

Correct Answer:

e

Fals

Question 8 1 out of 1 points If a supply is GST-free, no GST is payable on the supply and the supplier generally cannot claim input tax credits for the GST payable on its related business inputs.



Selected Answer:

False

Correct Answer:

e

Fals

Question 9 1 out of 1 points A loan provided by a bank is an example of an input taxed supply.



Selected Answer:

True

Correct Answer:

e

Tru

Question 10 1 out of 1 points GST generally has a neutral effect on supplies between registered entities. Selected Answer:

True

Correct Answer:

e

Tru

QUIZ 4

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Question 1 1 out of 1 points All of the following are examples of ordinary income except:

Selected Answer:

the sale of a capital asset

Correct Answer:



the sale of a capital asset

Question 2 1 out of 1 points

The 'mutuality' principle holds that taxpayers cannot derive income from themselves.



Selected Answer:

True

Correct Answer:

e

Tru

Question 3 1 out of 1 points

Similar conclusions - that the amounts received by the taxpayers were income - were reached in the cases of FCT v Harris (1980) and FCT v Blake (1984).



Selected Answer:

False

Correct Answer:

e

Fals

Question 4 1 out of 1 points From which case is the following excerpt taken? 'Although it is well settled that a profit or gain made in the ordinary course of carrying on a business constitutes income, it does not follow that a profit or gain made in a transaction entered into otherwise than in the ordinary course of carrying on the taxpayer s business is not income.'

Selected Answer:

Correct Answer:



Question 5

FC of T v The Myer Emporium Ltd (1987)

FC of T v The Myer Emporium Ltd (1987)

1 out of 1 points

Payments received for entering into restrictive covenants are generally of an income nature.



Selected Answer:

False

Correct Answer:

e

Fals

Question 6 1 out of 1 points Whose perspective is critical in determining whether amounts received are income - the payer's or the recipient's? Selected Answer:

Correct Answer:



the recipient's

the recipient's

Question 7 1 out of 1 points Identify the cases from the information provided.



Question

Correct Match

Selected Match

This UK case involved a famous actor who received a payment for agreeing not to produce, direct or act in another film for 18 months.

C. Higgs (Inspector of Taxes) v Olivier (1951)

C. Higgs (Inspector of Taxes) v Olivier (1951)

This case involved a police officer who competed as a javelin thrower at national and international sporting events and received sponsorships and prize money.

B. FCT v Stone (2005)

B. FCT v Stone (2005)

This case involved a professional footballer receiving a cash award from a television station for being awarded the 'best and fairest' player in his league.

D. Kelly v FCT (1985)

D. Kelly v FCT (1985)

This case involved soft drink retailers who were provided with a free overseas holiday by a soft drink manufacturer as part of a sales incentive scheme.

A. FCT v Cooke & Sherden (1980)

A. FCT v Cooke & Sherden (1980)

Question 8

1 out of 1 points In which case(s) were the compensation payments received by the taxpayer treated as capital in nature? Selected Answers:

Van den Berghs Ltd v Clark (Inspector of Taxes) (1935) Glenboig Union Fireclay Co Ltd v IRC (1922) Californian Oil Products Ltd (in liq) v FCT (1934)

Correct Answers:

Van den Berghs Ltd v Clark (Inspector of Taxes) (1935) Glenboig Union Fireclay Co Ltd v IRC (1922) Californian Oil Products Ltd (in liq) v FCT (1934)

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Question 9 1 out of 1 points In which case was it stated that the method of accounting to be adopted by a taxpayer is that which 'is calculated to give a substantially correct reflex of the taxpayer's true income'? Selected Answer:

Correct Answer:



C of T (SA) v The Executor Trustee and Agency Co of South Australia Ltd (1938)

C of T (SA) v The Executor Trustee and Agency Co of South Australia Ltd (1938)

Question 10 1 out of 1 points In which case(s) was the cash basis found to be the appropriate method of returning income? Selected Answers:

FCT v Firstenberg (1976) FCT v Dunn (1989)

Correct Answers:

FCT v Firstenberg (1976)

FCT v Dunn (1989)

QUIZ 5

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Question 1 1 out of 1 points Which test(s) have assisted the courts in distinguishing between 'revenue' and 'capital' outgoings? Selected Answers:

the 'business entity' test the 'enduring benefit' test the 'once and for all' test

Correct Answers:

the 'business entity' test the 'enduring benefit' test the 'once and for all' test

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Question 2 1 out of 1 points Identify the following cases from the information provided.

Question

Correct Match

Selected Match

A flight attendant was allowed to deduct the cost of her shows, which were required to be a halfsize larger than her normal shoes because of cabin pressure.

B. Mansfield v FCT (1996)

B. Mansfield v FCT (1996)

C. FCT v Edwards (1994)

C. FCT v Edwards (1994)

An architect was allowed deductions for expenses he incurred in travelling overseas for almost a year to study architecture.

A. FCT v Finn (1961)

A. FCT v Finn (1961)

A self-employed scriptwriter was allowed deductions for a portion of the rent paid on her flat on the basis that she dedicated a separate

D. Swinford v

D. Swinford v

A personal secretary who accompanied a Governor's wife on official occasions was allowed deductions for the cost of additional clothing such as hats, gloves, formal evening wear.

room in the flat for use as her study.



FCT (1984)

FCT (1984)

Question 3 1 out of 1 points There is no requirement in section 8-1 ITAA97 to quarantine deductions for losses and outgoings against particular categories of assessable income.



Selected Answer:

True

Correct Answer:

e

Tru

Question 4 1 out of 1 points

A medical student who is not yet practising as a doctor would ordinarily be denied a deduction for the cost of textbooks.



Selected Answer:

True

Correct Answer:

e

Tru

Question 5 1 out of 1 points All of the following cases consider the deductibility of child-minding expenses except: Selected Answer:

Lunney & Hayley v FCT (1958)

Correct Answer:



Lunney & Hayley v FCT (1958)

Question 6 1 out of 1 points Where a home office is used as a 'place of business', a relevant proportion of both 'running expenses' and 'occupancy expenses' can be deducted.



Selected Answer:

True

Correct Answer:

e

Tru

Question 7 1 out of 1 points Match the following cases with the key principles/tests for which they have become known:



Question

Correct Match

Selected Match

the issue of apportionment

D. Ronpibon Tin NL v (1949)

D. Ronpibon Tin NL v (1949)

'business entity' test

A. Sun Newspapers Ltd v FCT (1938)

A. Sun Newspapers Ltd v FCT (1938)

'once and for all' test

C. Vallambrosa Rubber Co Ltd v Farmer (1910)

C. Vallambrosa Rubber Co Ltd v Farmer (1910)

'enduring benefit' test

B. British Insulated & Helsby Cables Ltd v Atherton (1926)

B. British Insulated & Helsby Cables Ltd v Atherton (1926)

Question 8 1 out of 1 points In response to which case did the Government enact section 26-19 ITAA97, which denies deductions for self-education expenses relating to certain government assistance payments such as the Youth Allowance? Selected Answer:

FCT v Anstis (2010)

Correct Answer:



FCT v Anstis (2010)

Question 9 1 out of 1 points In which case(s) were the taxpayers allowed a deduction for the cost of travel between home and work? Selected Answers:

FCT v Vogt (1975) FCT v Collings (1976) FCT v Wiener (1978)

Correct Answers:

FCT v Vogt (1975) FCT v Collings (1976)

FCT v Wiener (1978)



Question 10 1 out of 1 points The fact that the amount of a liability cannot be precisely ascertained does not necessarily mean that the liability is 'contingent' and therefore not deductible. Selected Answer:

True

Correct Answer:

e

Tru

QUIZ 6 

Question 1 1 out of 1 points Match the following items with their provisions in Division 15 ITAA97:



Question

Correct Match

Selected Match

reimbursed FBT-exempt car expense payment benefits

C. s15-70

C. s15-70

royalties not otherwise assessable under s6-5 ITAA97

A. s15-20

A. s15-20

return to work payments

E. s15-3

E. s15-3

allowances received in respect of employment

B. s15-2

B. s15-2

interest payable on overpayments and early payments of tax

D. s15-35

D. s15-35

Question 2 1 out of 1 points Which item(s) fall within the list of specific deduction provisions that are considered assessable recoupments under Subdivision 20-A ITAA97? Selected Answers:

tax-related expenses (s25-5 ITAA97) bad debts (s25-35 ITAA97) capital allowances (Div 40 ITAA97)

Correct Answers:

tax-related expenses (s25-5 ITAA97) bad debts (s25-35 ITAA97) capital allowances (Div 40 ITAA97)



Question 3 1 out of 1 points

Which of the following is not an example of 'exempt income'?

Selected Answer:

fringe benefits under the FBTAA