Casimaty V. FCT 97 ATC 5135: Case Study

Superior Essays
In the case of Casimaty v FCT 97 ATC 5135, the taxpayer was doing fencing and farming business, which his father inherited an amount of 998 acres land that was known as “Acton View” (Australian Tax Casebook p.162). He then purchased another 40 acres of land, which he built a homestead. As time goes by, he suffered some sort of difficulties as there were drought, severe financial debts, and as well as poor health condition. As he had no alternatives, so he decided to sell-off portions of the land from time to time as to reduce the burden of his debt. There was a series of eight subdivisions and a large portion of property was sold. So the issue was whether the sale of various subdivisions and a portion of the taxpayer’s farming property were undertaken as a part of the conduct of the business with the result that the profits are assessable under s 25(1) of ITAA 1936 of the Income Assessment Act or whether the proceeds are assessable under the second limb of s 25A of ITAA 1936 of the Act. The Commissioner held that the taxpayer’s profit on selling the property is assessable under the Income Tax Assessment. It can be assessed under either s 25(1) as income gained from carrying on a business of selling the …show more content…
Still and all, it only applies to assets purchased before 20 September 1985, and where the profit of reselling that asset that existed at the time of purchase was at the sole purpose of the taxpayer, Eisner v FCT. Back to the above case, under the first limb, the taxpayer did not bought the property but was given to him by his father without costing him any amount of money. Nor in the second limb, the taxpayer did not have an intention on carrying on a business by selling his property and he did not make any advertisement but relied to his agent to sell his

Related Documents

  • Improved Essays

    (a) Material facts of the case Hacon & Sons Pty Ltd is a family grazing business and a trustee for the Hacon Family Trust. After Mr Walter Hacon and his wife passed away, the remaining shareholders of the Hacon & Sons Pty Ltd are their three sons. The properties that trustee’s grazing business were conducted on are owned by corporate subsidiaries of the trustee, and three sons. The allocation of the operation profit of the company is not conducted by dividend but invest to the distributed fund by the trustee in “off-farm assets”.…

    • 954 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Rouses Corp. Case Study

    • 651 Words
    • 3 Pages

    (Rouses) is a calendar year-end company. On February 1, 2014, Rouses announced that it was acquiring 80 percent of the outstanding common stock of Best Beans Ever Corp. (Best Beans Ever) in a business combination. On the acquisition date, Rouses paid $40 million in cash and issued two million shares of Rouses common stock to the selling shareholders of Best Beans Ever.…

    • 651 Words
    • 3 Pages
    Improved Essays
  • Improved Essays

    The relevant law, UCC Article 2, deals with the sale of goods, determining that goods are movable objects identified in the sale contract, with a sale being defined as the exchange of title from seller to buyer. The facts of the law conclude that the movable objects AVA was selling to Tanzer were, in fact, goods being sold, and not constructed due to the objects being previously manufactured and simply installed in the home. Thus, Article 2 of the UCC had jurisdiction in the…

    • 755 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Section 1001(a) provides the guideline for gain or loss made from sale or disposition of property, defining it as the amount realized in excess or lower than the adjusted basis of the property. The section defines amount realized as the sum total of all money received and any other fair market value received in noncash form for the property. Mrs. Smot case amount realized is damage claim from an insurance, which can only be realized as capital gains on assets as part of business casualty gain or loss under section 165(f). The settlement amount of $1.1million meant that Lynn realized a gain $266,600 from the involuntary conversion after the fire.…

    • 489 Words
    • 2 Pages
    Improved Essays
  • Improved Essays

    South Carolina Coastal Council were the Lucas’ property was essentially a “taking” of his property for a public purpose and therefore according to the Fifth Amendment he should have been compensated by the state for the loss of his personal property. David Lucas never questioned the states exercise of their police powers only his Constitutional right to be compensated for the taking of his property value. The state argued that they didn’t physically take the Lucas’ ocean front property they merely changed the planned purpose of the property, for the environmental greater good of society, resulting in a loss of investment but not a loss of property and they are not legally responsible for the reduction of the properties’ value. The state also stated in their respondent, that the Lucas’s knew there would be restrictions placed on his land that would reduce the property’s value, and that he could not expect that he would be free from government restrictions in the future.…

    • 1084 Words
    • 5 Pages
    Improved Essays
  • Improved Essays

    Supreme Court of the United States School Dist. of Abington Tp. v. Schempp, 374 U.S. 203 (1963) School District of Abington Township, Pennsylvania v. Schempp No. 142 Argued February 27-28, 1963 Decided June 17, 1963* 374 U.S. 203. Facts: The Supreme Court of the United States heard the School District of Abington Township, Pennsylvania v. Schempp case on February 27-28, 1963, and reached a verdict on June 17, 1963.…

    • 662 Words
    • 3 Pages
    Improved Essays
  • Decent Essays

    1. Will Mame recognize a gain on her individual tax return for a portion of the insurance proceeds given that the fair market value of the property lost in the fire exceeds her adjusted basis in the property? Section 1033(a)(2)(a) states that property that is destroyed and involuntarily converted into money would recognize a gain equal to the amount of proceeds realized minus the taxpayer’s adjusted basis in the property. However, the taxpayer can make an election to defer either some or all of the gain if she “purchases other property similar or related in service or use to the property converted.” a. Will Mame recognize a gain on the insurance proceeds resulting from a loss of the hotel and furniture given that she is building a new hotel…

    • 329 Words
    • 2 Pages
    Decent Essays
  • Improved Essays

    The Kelo Case

    • 885 Words
    • 4 Pages

    The city approved a development plan designed to revitalize the ailing economy through its development agent, which purchased most of the property for the project. The city could not take the land to confer a private benefit for a single party, but the court had embraced a more broad and natural interpretation for public use as “public purpose” (Kelo). The city had determined that the area at issue was going to justify economic rejuvenation and was entitled to deference, which then the city had made the plans to what they thought would benefit the community as a whole. In entirety, the government cannot take private property unless the forfeiting of the property is for the public’s use and does not benefit another private…

    • 885 Words
    • 4 Pages
    Improved Essays
  • Decent Essays

    To brief about the root-cause for the real property existence testing findings.  For 11 assets, the installation did not provide a DD Form 1354 (or an equivalent KSD).  For 28 assets, we were unable to trace attributes, RPUID, CATCODE, and Asset Description, from the KSD to the Q3 FY16 asset listing.  For 27 assets, the installation was unable to provide a time-stamped picture of the asset with the facility number affixed to the property.  For 19 assets, we were unable to determine if DoDEA had the right to report the asset.…

    • 162 Words
    • 1 Pages
    Decent Essays
  • Improved Essays

    Sherbert v. Verner Sherbert v. Verner, was argued on April 24, 1963, and the Supreme Court, in a 7-2 ruling, reversed the opinion of the lower court that had denied the appellant, Adeil Sherbert, unemployment benefits, on June 17, 1963. The appellant had been a Seventh Day Adventist from South Carolina whose religious practices prevented her from working on Saturdays. Her inability to work Saturdays caused her to be fired when her former workplace took up a six-day workweek, and subsequently, no other jobs would hire her for the same reason. Although Sherbert tried to obtain unemployment insurance, the South Carolina government denied her claim, stating that benefits were unavailable to people whom potentially had employment available to…

    • 1339 Words
    • 6 Pages
    Improved Essays
  • Improved Essays

    Nuisance can be separated into private, public and statutory nuisance. Private nuisance is “ the unreasonable use of man of his land to the detriment of his neighbour (Miller v. Jackson [1977] QB 966 (CA); 3 All ER 338) and can only be claimed by the individual affected that has an interest in the land . The potential defendants can be the creators of the nuisance, regardless of whether they are also the occupiers of the property .…

    • 1023 Words
    • 4 Pages
    Improved Essays
  • Improved Essays

    Fifth Amendment Essay

    • 1608 Words
    • 7 Pages

    (US Const. Amend. V, sec. 3) The fifth amendment fails to protect the individual from the unjust seizure of land from the government, for there is no clause that allows for protecting one’s land if not compelled to sell. Even when given the right, the…

    • 1608 Words
    • 7 Pages
    Improved Essays
  • Decent Essays

    Stefanik, Thompson, Khalabari, Vega December 12, 2016 House Bill No. __________ Patron–– § 1. Notwithstanding any other provision of law, no state or local government department, agency, or instrumentality having jurisdiction over criminal law enforcement or regulatory violations, including but not limited to the Department of State Police and any school division, and no department of law enforcement as defined in § 15.2-836 of the Code of Virginia of any county, city, or town shall purchase or deploy body-worn cameras before the department, agency or instrumentality has adopted and made available for public comment and review a policy for the deployment of such cameras that includes provisions implementing the following requirements: The…

    • 636 Words
    • 3 Pages
    Decent Essays
  • Improved Essays

    Through the years, it has been unclear to many people whether or not eminent domain has been used correctly. Many people disagree, but those are the people who have been affected by it directly. The opinions on this question are mostly biased, but looking at it from an outside standpoint, eminent domain is being used correctly. The Fifth Amendment states that the government has the right to take private property if they can prove that the property is going to be used for public use.…

    • 506 Words
    • 3 Pages
    Improved Essays
  • Decent Essays

    An Unsuccessful Case about Brockhouse (Mr. PD, Mrs. J & LD) v HM Revenue & Customs Commissioners (2011). The taxpayers run a business and they are provide and sell the fish, aquariums, ponds and associated products to the customers. They also have a part of the place are composed a field with a storage lake. In the tax year on April 2007, they had spent about £81,000 on over 2,000 metres of galvanised the fence around the field periphery. However, the taxpayers claimed capital allowances that the fence was plant because they said it was an installation to improve their…

    • 101 Words
    • 1 Pages
    Decent Essays

Related Topics