Question

Q 1

(Investor, capital gains)

Karl Kruger is a 38 year-old single Australian resident taxpayer. During the 2017/18 tax year, Karl received and retained the following records:

Account Summary received from XYZ Bank
Interest from Term Deposits	$ 17,200
Interest from Savings Account	350
Bank Charges relating to Term Deposits	40
Interest charged on line of credit (used for personal expenses)	715
4 February 2018 Dividend Statement from Eccy Ltd
Franked Dividend	2,100
Franking Credits	900
Rental Summary from Hawkeye Real Estate
Gross Rent Received	15,200
Rental expenses:
Agent’s Commission	920
Council Rates	1,490
Landlord Insurance	290

Other Information:

• Karl’s rental property was built in 1999 when total construction costs of $200,000 were incurred. Karl has owned and leased the property since 2009.
• Karl made mortgage repayments on his rental property of $20,000, of which $12,100 was principal.
• Karl also sold the following assets during the year:

ASSET	PURCHASE COST	ACQUISITION DATE	DISPOSAL DATE	SALE PRICE
Quality shares	$12,000	12 Apr 12	10 May  18	$18,600
Oil Painting (collectable)	6,000	03 Mar 98	26 Feb 18	5,200
Crummy shares	4,000	21 Aug 08	03 May 18	2,500

Required:

1. Calculate Karl’s net capital gain/loss for the 2017/18 tax year.
2. Calculate Karl’s taxable income for the 2017/18 tax year.

Answer 1

Answer: