Subject Code : ACC3TAX
Assignment Task:

Case Study: Enzo Satriani (ACC3TAX)
 
Enzo Satriani is a tax accountant who operates his taxation and accounting business “Enzo Tax”, which has multiple unrelated clients. Enzo primarily works from his home office located in Bundoora, and occasionally works at the premises of his client Fallali Pty Ltd. He employs an administrative assistant on a part-time basis to take phone calls and manage appointments, and he is also assisted by an intern – a taxation student who is undertaking a work placement subject. The intern provides basic data entry services but does not prepare or finalise any returns, major taxation and accounting work or advice. The major part of the work is prepared and finalised by Enzo and is estimated to be more than 80% of the workload. Neither the administrative assistant nor taxation intern is the associate of Enzo.  
 
In 2019/20 Enzo Tax earned a total of $648,000 in client fees, 70% of which it received from its main client Fallali Pty Ltd, to whom Enzo has provided on-going general taxation and accounting services for many years including the preparation and lodgement of monthly Business Activity Statements (BASs), general and specific taxation advice, management of accounts and other accounting services required from time to time. Fall Pty Ltd regards Enzo as almost being one of its staff members as he is regarded as being its in-house taxation and accounting resource. The remaining 30% of fees comes from several minor clients for whom Hawks Tax is contracted to provide specific advice on engagements.  
 
The growth in the business of Hawks Tax has been fully due to word of mouth referrals and the firm has not ever advertised its services, participated in tender arrangements or maintained a website. 
 
At as 30 June, 2020 Enzo has invoiced fees of $648,000 but only received payment of $576,000. He also paid PAYG quarterly instalments totalling $113,680 in the current year. 
 
The following expenses were incurred by Enzo Satriani in relation to his business during the current income year:

Enzo Satriani in relation to his busines

In addition to the above expenses, Enzo owned and used the following office equipment items in the operations of Enzo Tax during the income year: desktop computers, printing machine and office furniture, with a total adjustable value of $15,000 at the beginning of the year; on 16 August 2019, Enzo purchased another laptop computer for business use for $5,000. Enzo estimated that all these office equipment items would have a remaining effective life of 5 years. 
 
In February 2020 Enzo was injured and was in the hospital for three weeks. As he was covered by a private health insurance policy during the year, his medical expenses were covered by his insurer. He also received a $5,000 insurance premium for having lost some mobility in his right hand from this injury. This amount was paid on 2 March 2020. 
 
After his injury, Enzo reassessed his life and decided to reduce his workload by 50%. On 1 April 2020, he moved permanently to his beach house in Frankston and decided to dedicate part of his free time to his favourite activity: photography. He purchased a professional camera and shared his photos on his Instagram profile. Within weeks his profile became highly popular and he observed an exponential growth in the number of his followers. On 1 June 2020 Enzo entered into an informal agreement with a manufacturer of photography equipment whereby Enzo would be provided with free equipment which he would test and review on his Instagram profile. By the 30 June 2020, Enzo had received and tested photography equipment worth $2,500. 

Required:(ACC3TAX)
 
(a) As a tax accountant, advise Enzo Satriani on the income tax consequences of the above activities for the year ending 30 June 2020, applying legislation and case law to support your answer.

(b) Calculate and try to minimise Enzo Satriani’s tax liability for the year ending 30 June 2020, applying legislation and case law to support your answer.

Enzo Satriani on the income tax consequences


This ACC3TAX: Taxation Assignment has been solved by our Accounting Experts at UniLearnO. Our Assignment Writing Experts are efficient to provide a fresh solution to this question. We are serving more than 10000+ Students in Australia, UK & US by helping them to score HD in their academics. Our experts are well trained to follow all marking rubrics & referencing style.

Be it a used or new solution, the quality of the work submitted by our assignment experts remains unhampered. You may continue to expect the same or even better quality with the used and new assignment solution files respectively. There’s one thing to be noticed that you could choose one between the two and acquire an HD either way. You could choose a new assignment solution file to get yourself an exclusive, plagiarism (with free Turnitin file), expert quality assignment or order an old solution file that was considered worthy of the highest distinction.

Eureka! You've stumped our genius minds (for now)! This exciting new question has our experts buzzing with curiosity. We can't wait to craft a fresh solution just for you!

  • Uploaded By : Alex Cerry
  • Posted on : February 14th, 2019

Whatsapp Tap to ChatGet instant assistance