LAWS20060 Taxation Law of Australia
Assessment 1 – Individual Case Study (40%) – 2026

1. Unit and Assessment Overview

Unit code and title: LAWS20060 – Taxation Law of Australia

Term: Term 2, 2026

Assessment task: Assessment 1 – Individual Case Study

Weighting: 40% of overall grade

Length: 2,000–3,000 words (excluding reference list, footnotes, cover page and headings)

Due date: Week 7 Wednesday, 11:45 pm (AEST)

Submission mode: Online via Moodle (Assessment 1 submission link)

File format: Single file in .doc or .docx (MS Word) format only. Submissions in any other format such as .zip, .pages, .odt or .pdf will be treated as non-submissions.

Referencing style: Australian Guide to Legal Citation (AGLC4) for legislation and cases; APA 7th edition permitted for secondary sources where appropriate, in line with School of Law standards.

2. Academic Integrity, Extensions and Late Penalties

2.1 Plagiarism and Contract Cheating

Academic integrity is mandatory. You must prepare and submit your own original work and must not use any third-party assignment writing services, file-sharing sites or artificial intelligence tools in a way that breaches university policy. Submissions may be checked using text-matching software and pattern analysis aligned with School of Law academic misconduct procedures. Proven plagiarism or contract cheating will normally result in a mark of zero for this assessment and may trigger formal misconduct proceedings.

2.2 Extensions

Extension requests must be made via the online extension system before the due date and must be supported by evidence of medical, compassionate or other approved grounds. Work commitments, poor time management, computer issues or temporary last-minute illness will not usually justify an extension. Law graduates are expected to manage workload, deadlines and contingencies professionally.

2.3 Late Submission

Unless an approved extension applies, late submissions will attract penalties in accordance with current CQUniversity assessment procedures, typically a percentage deduction for each calendar day or part day late, up to a specified cap, after which no marks are awarded. Students must consult the current unit Moodle site and Assessment Policy for the applicable penalty rate in the relevant term.

3. Learning Outcomes Assessed

This assessment is designed to assess the following LAWS20060 learning outcomes:

• Demonstrate a sound understanding of the Australian taxation system and the sources of Australian taxation law.
• Identify, interpret and apply relevant provisions of income tax legislation and associated case law to factual scenarios.
• Analyse common business and personal transactions to determine their income tax consequences for taxpayers.
• Communicate written advice in clear, accurate and structured form, using appropriate legal referencing conventions.

4. Assessment Task – 2026 Scenario Case Study

4.1 Instructions to Students

Answer both Question 1 and Question 2. Your responses must be presented as an integrated advice memorandum to a professional client, structured with clear headings and subheadings, and written in formal, concise and precise legal language. You must correctly identify the relevant legal issues, cite and explain the applicable statutory provisions and case law, and then apply them to the facts before reaching a reasoned conclusion for each item.

Use ILAC or IRAC, or a comparable structured method, throughout but do not use ILAC or IRAC as headings. You must support your analysis with references to the Income Tax Assessment Act 1936 (Cth), Income Tax Assessment Act 1997 (Cth), relevant Australian Taxation Office rulings or guidance, and leading cases on income, ordinary income, receipts, deductions and travel expenses where appropriate.

4.2 Question 1 – Tax Treatment of Various Receipts and Outgoings (20 marks)

Required: Advise your client on the Australian income tax treatment of each of the following items for the 2025–2026 income year. Your advice should state:

• Whether the amount is assessable income, being ordinary income or statutory income, exempt income, non-assessable non-exempt income, capital, or not income at all; and/or
• Whether the outgoing is deductible in whole or in part, non-deductible, or of a capital or private nature,

and must briefly explain the reasons by reference to legislation, Australian Taxation Office guidance and case law, applied to the specific facts.

1. Frequent flyer points credited to a consultant’s personal airline loyalty account in relation to work-related flights paid for by their employer, a national management consultancy firm.
2. Lump-sum payments received by a crane hire business from customers after damage to a crane during on-site operations. Assume the crane is a depreciating asset used solely in the business and that insurance arrangements are in place.
3. An all-inclusive overseas holiday package provided to a nightclub manager by a major alcohol brand following a successful promotional campaign.
4. A return of surplus funds to members of a non-profit paddle sports club after a fundraising drive exceeds the cost of purchasing new canoes.
5. A one-off cash payment made by a national television network to a professional footballer on being named the league’s “Best and Fairest” player.
6. Course fees and associated materials for a building-construction qualification undertaken by a current building apprentice who is employed full-time on construction sites.
7. Fees for a short introductory course in arts management undertaken by an employee currently working as a junior marketing assistant who hopes to transition into art-gallery management in the future.
8. Expenditure on makeup, hair styling and specialised clothing required under a written grooming policy by a public-facing employee such as a news presenter or flight attendant.
9. Daily travel expenses incurred in commuting between the taxpayer’s home and their regular office location.
10. Travel costs incurred on the same day in moving directly between two separate employers where both employments are ongoing and unrelated.

Guidance for Question 1: Do not provide lengthy case summaries. Focus on accurate issue identification, pinpoint citation of statutory provisions such as ITAA 1997 s 6-5, s 8-1 and Division 40, and relevant Fringe Benefits Tax Act provisions where applicable. Identify key principles from leading authorities and apply them briefly but precisely to the facts. You may assume the taxpayers are Australian residents for tax purposes unless otherwise indicated.

4.3 Question 2 – Individual Taxpayer Calculation and Advice (20 marks)

Manpreet is an international student enrolled in an accounting degree at CQU Sydney. She commenced her studies in Term 1, 2025 and for the 2025–2026 Australian income year she is treated as a resident for tax purposes. She works part-time as an office assistant in a small accounting firm to gain local experience and earns salary and wages of AUD 48,000 during the year.

In addition to her wages, during the 2025–2026 income year the following amounts and expenses arise:

• She receives AUD 22,000 from her parents in India to assist with rent and living costs while she studies.
• She receives a distribution of AUD 12,000 from a discretionary family trust established in India by her grandmother. The trust invests in listed securities and term deposits offshore. Local Indian tax of AUD 1,200 has been paid on the income component of this distribution.
• She pays AUD 19,500 in university tuition fees and compulsory materials for her accounting degree in Australia.
• She purchases a laptop computer and printer costing a total of AUD 2,400, used 80% for study and 20% for private purposes.
• She acquires a new mobile phone for AUD 700 that her employer requires her to use for calls and emails, with 60% of usage being work-related.

Assume there are no other income amounts, deductions, offsets or HECS or HELP considerations. Apply the 2025–2026 resident individual tax rates and current Medicare levy settings as at 1 July 2025 and ignore any low-income tax offsets for the purpose of this question.

Required:

1. Using the Australian income tax formula, calculate Manpreet’s net tax payable or refundable amount for the 2025–2026 income year. Your calculation should clearly show:
   • Assessable income, with separate line items and short explanations for wages, foreign trust distribution and any other assessable receipt.
   • Allowable deductions, including treatment of self-education expenses and decline in value for the computer equipment and mobile phone, with reasonable assumptions as to effective life based on Australian Taxation Office guidance.
   • Taxable income.
   • Gross tax on taxable income using the applicable resident tax table.
   • Foreign income tax offset, if any, in respect of the Indian tax paid.
   • Medicare levy and any impact on net tax payable.
   • Final net tax payable position.
2. For each item of income, outgoing and offset, briefly explain:
   • Why it is included or excluded from assessable income, including distinguishing gifts and family support from income and applying ITAA 1936 s 99B to the foreign trust distribution where relevant.
   • Why it is deductible or non-deductible under ITAA 1997 s 8-1 and the self-education deduction rules.
   • How the foreign income tax offset rules operate in Manpreet’s circumstances.

Your answer must integrate calculation and explanation rather than presenting numbers alone. Use short, clearly labelled tables for the numerical steps where helpful, followed by concise narrative analysis.

5. Presentation, Formatting and Submission Requirements

• Use 12-point legible font such as Times New Roman or Calibri, 1.5 line spacing and standard margins.
• Include a cover page stating your name, student ID, unit code, assessment number, word count and due date.
• Use clear, descriptive headings and subheadings for each question and sub-issue.
• Number pages consecutively.
• Use footnotes for AGLC4 citations of cases and legislation and a reference list for secondary sources at the end of the document.
• Ensure all calculations are transparent, with any assumptions clearly stated and legally defensible.

6. Marking Rubric – Assessment 1 (40 marks)

Criterion 1: Identification of Issues (8 marks)

• High Distinction (7–8): Accurately identifies all material income and deduction issues across both questions, including less obvious residency, characterisation and foreign income implications. No significant issue is omitted and irrelevant material is minimal.
• Distinction (6): Correctly identifies most key issues with only minor omissions or occasional inclusion of peripheral matters.
• Credit (5): Identifies the main issues but may overlook some secondary or more nuanced points.
• Pass (4): Basic issues identified sufficient to answer the questions but with several omissions or inclusion of irrelevant considerations.
• Fail (0–3): Fails to identify major issues, mischaracterises key facts or focuses largely on irrelevant matters.

Criterion 2: Knowledge and Use of Law (12 marks)

• High Distinction (11–12): Demonstrates precise and accurate knowledge of relevant legislation, Australian Taxation Office rulings and leading cases. Provisions are correctly cited and interpreted and distinctions between ordinary income, statutory income, capital and private expenditure are articulated with authority. Foreign trust and foreign income tax offset provisions are accurately referenced and integrated.
• Distinction (9–10): Shows strong grasp of applicable statutory provisions and case law with only minor errors or omissions.
• Credit (7–8): Demonstrates competent but sometimes incomplete understanding of key provisions.
• Pass (5–6): Basic understanding of central legislative provisions is evident but important sections or authorities are missing, misapplied or superficially discussed.
• Fail (0–4): Limited or incorrect knowledge of the relevant law with frequent misstatements or missing authorities.

Criterion 3: Application and Analysis (12 marks)

• High Distinction (11–12): Provides clear and logically structured reasoning; applies law accurately to each fact scenario; differentiates similar fact patterns; and reaches well-supported conclusions. Demonstrates sophisticated understanding of how administrative guidance and case law operate in practice, including travel between workplaces, home to work transport and characterisation of foreign trust receipts.
• Distinction (9–10): Application is generally strong, with coherent reasoning and mostly well-supported conclusions.
• Credit (7–8): Reasoning is sound in many parts but some gaps or weaker links between law and facts are evident.
• Pass (5–6): Provides basic application of law to facts and analysis is often descriptive rather than analytical.
• Fail (0–4): Little or no meaningful application of law to the facts and conclusions are largely speculative.

Criterion 4: Calculations, Structure and Communication (8 marks)

• High Distinction (7–8): Tax calculations are accurate, clearly laid out and internally consistent. Structure is logical with effective headings and signposting. Writing is precise and professional. Referencing complies consistently with AGLC4 and APA requirements.
• Distinction (6): Calculations are mostly accurate with only minor errors. Expression is clear and well organised.
• Credit (5): Calculations contain some errors but the overall method is recognisable. Structure and writing are adequate.
• Pass (4): Some calculation and structural errors but the work remains understandable.
• Fail (0–3): Major or repeated calculation errors, poor organisation and significant referencing problems.

7.  Academic Commentary

The assessment framework reflects the doctrinal structure of Australian income tax law, which requires careful characterisation of receipts and outgoings before computational consequences can be determined. The distinction between ordinary income under ITAA 1997 s 6-5 and statutory inclusions such as those arising under ITAA 1936 s 99B demonstrates the continued centrality of judicial interpretation in defining the tax base. Contemporary scholarship emphasises that the concept of ordinary income remains grounded in case law principles concerning periodicity, reliance and nexus to income earning activity, which must then be reconciled with increasingly complex statutory regimes governing foreign source income and tax offsets (Hill & Stewart 2019). For students, the analytical discipline demanded by ILAC reasoning mirrors professional tax advisory practice, where legal characterisation, evidentiary assumptions and computational accuracy operate as interdependent elements of compliant tax reporting.

8. Recent References

• Burton, M 2023, ‘Residency, foreign income and the limits of source in Australian tax law’, Australian Tax Forum, vol. 38, no. 1, pp. 45–80.
• Deutsch, R, Fullerton, I, Gibson, M, Hanley, P & Snape, T 2024, Australian Tax Handbook 2024, Thomson Reuters, Sydney.
• Hill, J & Stewart, M 2019, ‘The characterisation of receipts and the continuing relevance of ordinary income’, eJournal of Tax Research, vol. 16, no. 3, pp. 452–480.
• Woellner, R, Barkoczy, S, Murphy, S, Evans, C & Pinto, D 2022, Australian Taxation Law 2022, 32nd edn, Oxford University Press, Melbourne.
• Australian Taxation Office 2024, ‘Trips you can and cannot claim’, Australian Taxation Office.
• Sadiq, K, Coleman, C, McCullough, R & Tooma, R 2023, Principles of Taxation Law 2023, Thomson Reuters, Sydney.