Order Income Tax Assessment Help

Order Income Tax Assessment Help
2-1 Modern globalisation means that goods, services, money,
transnational corporations and, to a lesser extent, people can move and
operate freely between countries. This means that determining where
income is earned for tax purposes is no longer a simple matter. This
chapter, international tax, deals with the way Australian taxing
authorities determine whether a taxpayer is an Australian resident for
tax purposes and determines the source of income earned. Although
globalisation has freed the movement of goods and services between
countries, laws tend to operate within the sovereign borders of nation
states. In other words, Australian tax laws have no standing to operate
in other countries. This may be moderated when countries sign
international tax treaties.
In Planche v Fletcher (1779) 99 ER 164 it appeared that English
goods being sent to France from London had been sent via a third port,
Ostend, in order to reduce or avoid French import duties. In his
decision, Lord Mansfield held that ‘at any rate, this was no fraud on
this country (England). One nation does not take notice of the revenue
laws of another country’.
2-2 The Income Tax Assessment Act 1997 (Cth) (ITAA 1997) s 6-
5(2) states:
(a)
(b)
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1.
2.
3.
4.
If you are an Australian resident, your assessable income includes the ordinary income
you derived directly or indirectly from all sources, whether in or out of Australia, during
the income year.
ITAA 1997 s 6-5(3) states:
If you are a foreign resident, your assessable income includes:
The ordinary income you derived directly or indirectly from all Australian sources
during the income year; and
Other ordinary income that a provision includes in your assessable income for the
income year on some basis other than having an Australian source.
Individual income tax rates make a distinction according to whether
the taxpayer is an Australian resident or a foreign resident as follows:
There is no tax-free threshold for foreign residents.
Foreign residents initially pay tax at a higher rate than Australian
residents