HI6028 – Taxation Theory, Practice & Law

Individual Assignment

Holmes Institute

Trimester 1, 2026

Weighting: 20%

Assessment Description

This individual assignment assesses your ability to apply Australian taxation law to practical scenarios involving capital gains tax, income from personal exertion, and loan arrangements. You must interpret relevant legislation and case law, identify taxation issues, and provide reasoned conclusions supported by authority.

Submission Requirements

1. Individual submission only.
2. Word limit: Not more than 2,000 words (±10% acceptable).
3. Format: MS Word, no spacing, 12-pt Arial font, 2 cm margins all sides, section headings, page numbers.
4. Submit electronically via Blackboard (SafeAssign) by the due date (Week 10, 11:59 pm).
5. Use Harvard referencing style for in-text citations and reference list.
6. Minimum 8 references, including the prescribed textbook and recent authoritative sources (legislation, cases, ATO rulings, journal articles).
7. Plagiarism checked automatically; breaches handled per Academic Integrity Policy.
8. Late submissions incur penalties unless an approved extension is granted.

Questions

Question 1 (10 marks)

Your client Helen sold the following assets during the 2025/26 income year. Advise on the Capital Gains Tax consequences for each transaction, showing all workings and referencing relevant legislation and case law.

1. An antique impressionist painting purchased by Helen’s father in February 1985 for $4,500; sold on 1 December 2025 for $13,000.
2. A historical sculpture purchased in December 1993 for $5,800; sold on 1 January 2026 for $6,500.
3. An antique jewellery piece purchased in October 1987 for $14,500; sold on 20 March 2026 for $13,800.
4. A picture purchased by Helen’s mother in March 1987 for $520; sold on 1 July 2025 for $5,200.

Question 2 (5 marks)

Barbara, an economist researcher, accepted an offer of $14,000 from Eco Books Ltd to write a book on economics principles. She wrote the book titled ‘Principles of Economics’ in her spare time and assigned the copyright to Eco Books Ltd for $14,500. The book was published and she received payment. She also sold the manuscript to the company library for $4,800 and several interview transcripts for $3,500.

Discuss whether each payment constitutes income from Barbara’s personal exertion. Support your answer with relevant statutory provisions and case law. Would your conclusion differ if Barbara had completed the book before signing the contract and only later decided to sell it? Explain.

Question 3 (5 marks)

Patrick lent his son David $55,000 to assist with a new business venture. They agreed David would repay $62,000 after five years. No formal agreement or security existed, and Patrick stated no interest was required. David repaid the full amount after two years via cheque, including an additional 5% on the borrowed sum.

Discuss the effect of this arrangement on Patrick’s assessable income, referencing relevant statutory provisions and case law.

Assignment Structure

1. Question 1: Capital Gains Tax consequences for each asset (subheadings recommended).
2. Question 2: Analysis of Barbara’s income under the main scenario and alternative scenario.
3. Question 3: Effect on Patrick’s assessable income.
4. Reference List (Harvard style).

Marking Criteria

 Helen’s sale of the antique impressionist painting acquired before 20 September 1985 qualifies as a pre-CGT asset, making the $8,500 gain exempt from capital gains tax. The historical sculpture sold for a modest gain triggers CGT, but the 50% discount applies due to holding period exceeding 12 months. The antique jewellery produced a small loss that can offset other gains. The picture inherited from her mother retains the original acquisition date, exempting the gain as pre-CGT. Proper classification of acquisition dates and holding periods is essential to avoid incorrect tax liabilities (Barkoczy, 2025, Foundations of Taxation Law 2025, available at https://global.oup.com/academic/product/foundations-of-taxation-law-2025-9780190338695).

References

• Barkoczy, S., 2025. Foundations of taxation law 2025. 17th ed. Melbourne: Oxford University Press. Available at: https://global.oup.com/academic/product/foundations-of-taxation-law-2025-9780190338695.
• Deutsch, R., 2024. Australian tax handbook 2024. Sydney: Thomson Reuters. Available at: https://legal.thomsonreuters.com.au/australian-tax-handbook-2024/productdetail/131456.
• Krever, R., 2023. Australian taxation law cases 2023. Sydney: Thomson Reuters. Available at: https://legal.thomsonreuters.com.au/australian-taxation-law-cases-2023/productdetail/130045.
• Sadiq, K., 2026. Principles of taxation law 2026. Sydney: Thomson Reuters. Available at: https://legal.thomsonreuters.com.au/principles-of-taxation-law-2026/productdetail/132001.
• Woellner, R., 2025. Australian taxation law 2025. 35th ed. Sydney: Thomson Reuters. Available at: https://legal.thomsonreuters.com.au/australian-taxation-law-2025/productdetail/131457.