Assignment 2 Essay/Report
Value: 20%
Due date: 11-May-2014
Return date: 01-Jun-2014
Length: Approximately 3000 words
Submission method options
Hand delivery (option applies to Internal only)
Alternative submission method
Task
Refer to the relevant case law and statute law in your answer. you must read the presentation guidelines in the subject outline. Your answer must NOT 3 A4 pages, excluding the biblography
Question
Tim runs his an advertising agency. During the year he incurred the following expenses:
? Salary costs of $200,000;
? Salary costs of $10,000 for his daughter who worked with him for one week as part of her university training;
? Travel expenses of $3,000 for travel between home and work;
? Travel expenses of $1,000 for travel from a client’s premises to his home;
? $3,000 on a new suit to impress his clients;
? $1,500 on membership of the local sports club where he entertains clients;
? $3,000 in meal expenses on entertaining clients
?In May, Tim sent Tom to an advertising exhibition in Indonesia. Tom incurred expenses of $3,000 on the plane ticket and $1,000 on hotel costs. Tim employer did not reimburse him for those expenses but provided Tom with a daily allowance of $200 for his meal and transportation costs. Tom had chosen to go to the exhibition because her family is in Indonesia and he took the opportunity to visit them while she was there. The conference ran for three days and she stayed on for an additional five days at her parents’ home.
Required
Advise Tim and Tom of their tax consequences arising from the above information.?