| id,answer_label,correct_answer,numeric_answer,unit,explanation,answer_rationale,python_verifier,legal_references,source_url | |
| Q001,C,"$1,180",1180.0,AUD,"Reduced cost base = 4,000 (1,000 x $4) + 120 (1997 brokerage/stamp duty) + 60 (2023 brokerage) = 4,180 → Capital proceeds = 1,000 x $3 = 3,000 → Capital loss = reduced cost base - capital proceeds = 4,180 - 3,000 = 1,180","{""$590"": ""Wrongly halved the loss as if a 50% discount applied (discounts never apply to losses)"", ""-$1,180"": ""Subtracted in the wrong order, giving a negative (a gain instead of a loss)"", ""$1,180"": ""Correct answer"", ""$7,180"": ""Added proceeds to the reduced cost base instead of subtracting""}","{""formula"": ""reduced_cost_base - capital_proceeds"", ""params"": {""reduced_cost_base"": 4180, ""capital_proceeds"": 3000}, ""expected"": 1180.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 110-55"", ""ITAA 1997 s 102-10""]",https://www.ato.gov.au/forms-and-instructions/capital-gains-tax-guide-2024/about-capital-gains-tax/how-to-work-out-your-capital-gain-or-capital-loss | |
| Q002,A,"$3,713",3713.0,AUD,"2024-25 Stage 3 bracket: tax = (40,000 - 18,200) x 0.16 = 21,800 x 0.16 = 3,488. → Medicare levy = 40,000 x 0.02 = 800. → LITO (37,501-45,000 band) = 700 - (40,000 - 37,500) x 0.05 = 700 - 125 = 575. → Net tax = 3,488 + 800 - 575 = 3,713.","{""$3,713"": ""Correct answer"", ""$4,367"": ""Used the pre-Stage-3 19c rate (2023-24 and earlier) instead of the 16c rate that applies from 2024-25"", ""$2,913"": ""Forgot to add the 2% Medicare levy"", ""$4,288"": ""Forgot to subtract the low income tax offset (LITO)""}","{""formula"": ""(taxable_income - bracket_floor) * marginal_rate + taxable_income * medicare_rate - (lito_max - (taxable_income - lito_taper_start) * lito_taper_rate)"", ""params"": {""taxable_income"": 40000, ""bracket_floor"": 18200, ""marginal_rate"": 0.16, ""medicare_rate"": 0.02, ""lito_max"": 700, ""lito_taper_start"": 37500, ""lito_taper_rate"": 0.05, ""old_rate"": 0.19}, ""expected"": 3713.0}","[""ITAA 1997 s 4-10"", ""Income Tax Rates Act 1986 Sch 7"", ""ITAA 1936 s 159N"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/tax-rates-and-codes/tax-rates-australian-residents | |
| Q003,C,"$143,853",143853.0,AUD,"Tax-free limit = base + (service × years) = 11,985 + (5,994 × 22) → = 11,985 + 131,868 = 143,853 → As Priya's redundancy payment ($92,000) is less than the tax-free limit ($143,853), the whole payment is tax-free","{""$17,979"": ""Added only one year's service amount instead of multiplying by 22 years"", ""$131,868"": ""Omitted the base amount and counted only the service component"", ""$143,853"": ""Correct answer"", ""$92,000"": ""Assumed the tax-free limit equals the redundancy payment actually received ($92,000)""}","{""formula"": ""base + service*years"", ""params"": {""base"": 11985, ""service"": 5994, ""years"": 22, ""payment"": 92000}, ""expected"": 143853.0}","[""ITAA 1997 s 83-170"", ""ITAA 1997 s 83-175""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/engaging-a-worker/when-a-worker-leaves-your-business/taxation-of-termination-payments/redundancy-and-early-retirement | |
| Q004,A,"$95,901",95901.0,AUD,"Genuine redundancy tax-free limit = base amount + (service amount × years of service) → For the 2023-24 income year: base amount = $11,985, service amount = $5,994 → Tax-free part = 11,985 + (5,994 × 14) = 11,985 + 83,916 = 95,901","{""$95,901"": ""Correct answer"", ""$17,979"": ""Added only one year's service amount instead of multiplying by the 14 years of service"", ""$251,706"": ""Multiplied the base amount by years of service as well (the base amount is not multiplied)"", ""$83,916"": ""Omitted the base amount and counted only the service component""}","{""formula"": ""base + service*years"", ""params"": {""base"": 11985, ""service"": 5994, ""years"": 14, ""payment"": 205000}, ""expected"": 95901.0}","[""ITAA 1997 s 83-170"", ""ITAA 1997 s 83-175""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/engaging-a-worker/when-a-worker-leaves-your-business/taxation-of-termination-payments/redundancy-and-early-retirement | |
| Q005,C,$75,75.0,AUD,Taxable income = 750 assessable income - 250 deductions = 500 → Gross income tax = 500 x 30% = 150 → Apply $75 franking tax offset: 150 - 75 = 75 income tax payable,"{""$225"": ""Added the franking credit to the tax instead of offsetting it"", ""$50"": ""Used the 25% base-rate-entity rate instead of the 30% rate that applies here"", ""$75"": ""Correct answer"", ""$150"": ""Forgot to apply the $75 franking tax offset against the gross tax""}","{""formula"": ""taxable_income * tax_rate - franking_offset"", ""params"": {""taxable_income"": 500, ""tax_rate"": 0.3, ""franking_offset"": 75}, ""expected"": 75.0}","[""ITAA 1997 s 4-10"", ""ITAA 1997 s 207-20""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/in-detail/utilising-franking-tax-offsets-and-effect-on-losses-corporate-tax-entities | |
| Q006,D,"$1,230",1230.0,AUD,"Kept taxable income within the 2021-22 LMITO taper-down band ($90,001-$126,000) → LMITO above $90,000 = $1,500 minus 3 cents for every $1 above $90,000 → Income above the taper start = 99,000 - 90,000 = 9,000 → Reduction = 9,000 x 0.03 = 270 → LMITO = 1,500 - 270 = 1,230","{""-$1,470"": ""Applied the 3c taper to the whole taxable income instead of only the amount over $90,000"", ""$825"": ""Used the 7.5c phase-in rate (for the $37,000-$48,000 band) instead of the 3c phase-out rate"", ""$1,500"": ""Gave the full $1,500 LMITO without applying the 3c taper above $90,000"", ""$1,230"": ""Correct answer""}","{""formula"": ""max_offset - (taxable_income - taper_start) * taper_rate"", ""params"": {""taxable_income"": 99000, ""max_offset"": 1500, ""taper_start"": 90000, ""taper_rate"": 0.03}, ""expected"": 1230.0}","[""ITAA 1936 s 159N"", ""ITAA 1997 s 61-575""]",https://www.ato.gov.au/forms-and-instructions/low-and-middle-income-earner-tax-offsets | |
| Q007,D,"$2,804",2804.0,AUD,"Work-related kilometres = (46 × 33) + (12 × 118) + 252 = 1,518 + 1,416 + 252 = 3,186 km → 3,186 km is below the 5,000 km cap, so all of it is claimable → Deduction = 3,186 × $0.88 (2025-26 rate) = $2,804","{""$2,485"": ""Used the 2022-23 rate of 78 cents instead of the 2025-26 rate"", ""$4,400"": ""Claimed the full 5,000 km cap regardless of the actual 3,186 km travelled"", ""$2,708"": ""Used the 2023-24 rate of 85 cents instead of the 2025-26 rate of 88 cents"", ""$2,804"": ""Correct answer""}","{""formula"": ""round(min(business_km, 5000) * rate)"", ""params"": {""business_km"": 3186, ""rate"": 0.88, ""prior_rate"": 0.85, ""rate_2223"": 0.78}, ""expected"": 2804.0}","[""ITAA 1997 s 28-25"", ""ITAA 1997 s 8-1""]",https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/work-related-deductions/cars-transport-and-travel/motor-vehicle-and-car-expenses/expenses-for-a-car-you-own-or-lease/cents-per-kilometre-method | |
| Q008,A,"$7,280.70",7280.7,AUD,"The car fringe benefit is a type 1 benefit (GST credit available), so use the higher gross-up rate 2.0802 → 3,500 x 2.0802 = 7,280.70","{""$7,280.70"": ""Correct answer"", ""$3,500.00"": ""Reported the taxable value without grossing it up"", ""$3,421.93"": ""Applied the 47% FBT rate at the gross-up step instead of producing the grossed-up amount"", ""$6,603.80"": ""Used the type 2 gross-up rate 1.8868 instead of the type 1 rate 2.0802""}","{""formula"": ""car_value * type1_rate"", ""params"": {""car_value"": 3500, ""type1_rate"": 2.0802, ""type2_rate"": 1.8868}, ""expected"": 7280.7}","[""FBTAA 1986 s 5B"", ""FBTAA 1986 s 57A""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2024-instructions/worked-examples-not-for-profit-employers-completing-your-fbt-return | |
| Q009,C,$788,788.0,AUD,"Fixed rate for 2024-25 = 70 cents per work hour → Deduction = hours worked from home × rate per hour → = 1,126 × $0.70 = $788","{""$586"": ""Used the old 52 cents per hour rate (2020-21/2021-22)"", ""$1,126"": ""Reported the number of hours as the deduction without multiplying by the hourly rate"", ""$788"": ""Correct answer"", ""$754"": ""Used the 2022-23/2023-24 rate of 67 cents instead of the 2024-25 rate of 70 cents""}","{""formula"": ""round(hours * rate)"", ""params"": {""hours"": 1126, ""rate"": 0.7, ""prior_rate"": 0.67, ""rate_5253"": 0.52}, ""expected"": 788.0}","[""ITAA 1997 s 8-1"", ""PCG 2023/1""]",https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/work-related-deductions/working-from-home-expenses/fixed-rate-method | |
| Q010,B,$165.00,165.0,AUD,"Cost is $300 or less and the asset is used >50% for producing non-business assessable income, so an immediate deduction applies → Deduction is reduced for the 25% non-taxable (private) use: taxable use = 75% → Immediate deduction = 220 x 75% = 165","{""$55.00"": ""Apportioned by the 25% private-use percentage instead of the 75% taxable-use percentage"", ""$165.00"": ""Correct answer"", ""$219.75"": ""Subtracted the 0.25 fraction from the cost instead of multiplying"", ""$220.00"": ""Claimed the full $220 cost, ignoring the 25% private-use reduction""}","{""formula"": ""cost * taxable_pct"", ""params"": {""cost"": 220, ""taxable_pct"": 0.75, ""private_pct"": 0.25}, ""expected"": 165.0}","[""ITAA 1997 s 40-80(2)""]",https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2020/deductions-for-the-cost-of-depreciating-assets/working-out-decline-in-value/immediate-deduction-for-certain-non-business-depreciating-assets-costing-300-or-less | |
| Q011,D,"$25,143.00",25143.0,AUD,"Repayment income = 224,500 + 26,930 = 251,430, which is at or above $179,286 (the same top band as the base example) → In the top band the repayment is 10% of the whole repayment income, not a marginal amount → Compulsory repayment = 251,430 x 10% = 25,143.00, rounded to 25,143","{""$37,714.50"": ""Used the 15% first-band rate instead of the 10% top-band rate"", ""$7,214.40"": ""Applied 10% only to income above $179,286 instead of to the whole repayment income"", ""$30,193.10"": ""Used the $8,700 + 17c band instead of the 10% top band"", ""$25,143.00"": ""Correct answer""}","{""formula"": ""round(repayment_income * rate)"", ""params"": {""repayment_income"": 251430, ""rate"": 0.1, ""threshold"": 179286, ""lower_base"": 8700, ""lower_threshold"": 125000, ""lower_rate"": 0.17}, ""expected"": 25143.0}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q012,C,"$4,207",4207.0,AUD,"Kept taxable income within the 2023-24 $18,201-$45,000 bracket (19c for each $1 over $18,200) → Tax on income = (36,500 - 18,200) x 0.19 = 18,300 x 0.19 = 3,477 → Medicare levy = 36,500 x 0.02 = 730 → Tax payable incl Medicare levy = 3,477 + 730 = 4,207","{""$3,843"": ""Charged the Medicare levy only on income above the tax-free threshold instead of on the whole taxable income"", ""$7,665"": ""Applied the 19% rate to the whole income instead of only the amount over the $18,200 tax-free threshold"", ""$4,207"": ""Correct answer"", ""$3,477"": ""Forgot to add the 2% Medicare levy""}","{""formula"": ""(taxable_income - bracket_floor) * marginal_rate + taxable_income * medicare_rate"", ""params"": {""taxable_income"": 36500, ""bracket_floor"": 18200, ""marginal_rate"": 0.19, ""medicare_rate"": 0.02}, ""expected"": 4207.0}","[""ITAA 1997 s 4-10"", ""Income Tax Rates Act 1986 Sch 7"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/forms-and-instructions/foreign-income-tax-offset-rules-guide-2024/calculate-your-fito-or-offset-limit | |
| Q013,D,"$32,500",32500.0,AUD,"Available concessional cap = carried-forward unused 18,000 + 2024-25 standard cap 30,000 = 48,000 → Concessional contributions already used = employer SG 9,500 + personal deductible contribution 6,000 = 15,500 → Remaining headroom = 48,000 − 15,500 = 32,500","{""$42,000"": ""Forgot to count the $9,500 employer SG against the cap"", ""$30,000"": ""Used the 2021-22 cap of $27,500 instead of the 2024-25 cap of $30,000"", ""$14,500"": ""Ignored the $18,000 carried-forward unused concessional cap"", ""$32,500"": ""Correct answer""}","{""formula"": ""(carry_forward + cc_cap) - (sg + personal_deductible)"", ""params"": {""carry_forward"": 18000, ""cc_cap"": 30000, ""sg"": 9500, ""personal_deductible"": 6000, ""old_cap"": 27500}, ""expected"": 32500.0}","[""ITAA 1997 s 291-20"", ""ITAA 1997 s 291-25"", ""ITAA 1997 s 290-150""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/concessional-contributions-cap | |
| Q014,C,"$17,016",17016.0,AUD,"Kept resident_months within the valid 1-12 month range (9 of 12 months) → Flat component = $13,464 → Apportioned component = ($4,736 x 9) / 12 = 42,624 / 12 = 3,552 → Tax-free threshold = 13,464 + 3,552 = 17,016","{""$13,650"": ""Apportioned the whole $18,200 threshold instead of only the $4,736 component"", ""$18,200"": ""Gave the full $4,736 additional amount instead of apportioning it for 9 months"", ""$17,016"": ""Correct answer"", ""$13,464"": ""Used only the flat $13,464 and ignored the apportioned component entirely""}","{""formula"": ""flat_amount + apportioned_amount * resident_months / total_months"", ""params"": {""flat_amount"": 13464, ""apportioned_amount"": 4736, ""resident_months"": 9, ""total_months"": 12}, ""expected"": 17016.0}","[""Income Tax Rates Act 1986 s 20"", ""Income Tax Rates Act 1986 s 16""]",https://www.ato.gov.au/individuals-and-families/coming-to-australia-or-going-overseas/coming-to-australia/tax-free-threshold-for-newcomers-to-australia | |
| Q015,C,$500,500.0,AUD,"Personal non-concessional contributions for the year = $1,100 → Government matching at 50% = 1,100 x 0.5 = $550 → Capped at the maximum co-contribution of $500 (same cap as the base example), so Rosa receives the maximum $500","{""$550"": ""Applied the 50% matching rate without capping at the $500 maximum"", ""$275"": ""Halved the matched amount as if the matching rate were 25%"", ""$500"": ""Correct answer"", ""$1,100"": ""Treated the whole personal contribution as the co-contribution""}","{""formula"": ""min(personal_contribution * match_rate, max_cc)"", ""params"": {""personal_contribution"": 1100, ""match_rate"": 0.5, ""max_cc"": 500}, ""expected"": 500.0}","[""Superannuation (Government Co-contribution for Low Income Earners) Act 2003 s 9"", ""Superannuation (Government Co-contribution for Low Income Earners) Act 2003 s 10""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/how-to-save-more-in-your-super/government-super-contributions/super-co-contribution | |
| Q016,D,"$12,741.19",12741.19,AUD,"Amount of loan not repaid by end of previous (2015) income year P = 63,750 → 2016 benchmark interest rate I = 5.45% (0.0545); remaining term T = 6 years → Step 1: 63,750 x 0.0545 = 3,474.375 → Step 2: 1 / (1 + 0.0545) = 0.948316738 → Step 3: 0.948316738 ^ 6 = 0.72731157 → Step 4: 1 - 0.72731157 = 0.27268843 → Step 5: 3,474.375 / 0.27268843 = 12,741 (rounded to nearest dollar)","{""$12,944.01"": ""Used the prior year's 5.95% benchmark rate instead of the current 5.45% rate"", ""$3,474.38"": ""Charged only one year's interest instead of amortising over the remaining term"", ""$11,197.61"": ""Used the original 7-year term instead of the 6-year remaining term"", ""$12,741.19"": ""Correct answer""}","{""formula"": ""(P * I) / (1 - (1 / (1 + I)) ** T)"", ""params"": {""P"": 63750, ""I"": 0.0545, ""T"": 6}, ""expected"": 12741.19}","[""ITAA 1936 s 109E"", ""ITAA 1936 s 109N""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/private-company-benefits-division-7a-dividends/in-detail/division-7a-loans | |
| Q017,A,$378.00,378.0,AUD,"OTE component of the back pay = $3,150 of ordinary hours (the $945 overtime is not OTE) → Super guarantee rate (payment made 6 September 2025) = 12% (rate kept fixed from the base example) → SG = 3,150 x 12% = $378","{""$378.00"": ""Correct answer"", ""$113.40"": ""Applied SG to the overtime component only"", ""$491.40"": ""Included the $945 overtime back pay in OTE"", ""$362.25"": ""Used the old 11.5% SG rate instead of 12% applicable to the September 2025 payment""}","{""formula"": ""ordinary_backpay * sg_rate"", ""params"": {""ordinary_backpay"": 3150, ""overtime_backpay"": 945, ""sg_rate"": 0.12, ""old_rate"": 0.115}, ""expected"": 378.0}","[""Superannuation Guarantee (Administration) Act 1992 s 6(1)"", ""Superannuation Guarantee (Administration) Act 1992 s 19""]",https://www.ato.gov.au/businesses-and-organisations/super-for-employers/paying-super-contributions/how-much-super-to-pay | |
| Q018,A,"$3,400.00",3400.0,AUD,"Under the 50:50 split method, the taxable value is 50% of total expenditure on meal entertainment for all people (employees, clients or others) during the FBT year → Total meal entertainment expenditure = 6,800 → Taxable value = 6,800 x 50% = 3,400","{""$3,400.00"": ""Correct answer"", ""$6,415.12"": ""Grossed up the 50% taxable value by the Type 2 factor before reporting it"", ""$1,598.00"": ""Reported the FBT payable (47% of the taxable value) instead of the taxable value"", ""$6,800.00"": ""Treated the whole expenditure as the taxable value, ignoring the 50% split""}","{""formula"": ""total_meal_entertainment * split_rate"", ""params"": {""total_meal_entertainment"": 6800, ""split_rate"": 0.5}, ""expected"": 3400.0}","[""FBTAA 1986 s 37AA"", ""FBTAA 1986 s 37BA""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q019,C,"$3,940",3940.0,AUD,"Total operating costs = 16,400 (includes deemed depreciation at 25% and deemed interest) → Private use percentage = 100% - 65% business use = 35% → Operating costs x private use % = 16,400 x 35% = 5,740 → Reduce by the employee (recipient) contribution: 5,740 - 1,800 = 3,940","{""$7,540"": ""Added the employee contribution instead of subtracting it"", ""$5,740"": ""Forgot to subtract the $1,800 employee fuel contribution"", ""$3,940"": ""Correct answer"", ""$8,860"": ""Applied the 65% business use percentage instead of the 35% private use percentage""}","{""formula"": ""operating_costs * private_use_percent - employee_contribution"", ""params"": {""operating_costs"": 16400, ""business_use_percent"": 0.65, ""private_use_percent"": 0.35, ""employee_contribution"": 1800}, ""expected"": 3940.0}","[""FBTAA 1986 s 10"", ""FBTAA 1986 s 10(3)""]",https://www.ato.gov.au/law/view/document?locid=%27SAV/FBTGEMP/7.9%27&PiT=99991231235958 | |
| Q020,B,$600.00,600.0,AUD,"Provisional dividend to Marcus = 800 → Distributable surplus = 1,500; total of all provisional dividends = 2,000 → Distributable surplus (1,500) < total provisional dividends (2,000), so reduce proportionally → Amount treated as a dividend = 800 x (1,500 / 2,000) = 600 (included as an unfranked dividend)","{""$1,500.00"": ""Treated the entire distributable surplus as Marcus's dividend instead of apportioning it across all provisional dividends"", ""$600.00"": ""Correct answer"", ""$1,066.67"": ""Inverted the ratio (multiplied by total/surplus instead of surplus/total)"", ""$800.00"": ""Treated the whole $800 loan as a dividend, ignoring the distributable surplus cap""}","{""formula"": ""provisional_dividend * distributable_surplus / total_provisional"", ""params"": {""provisional_dividend"": 800, ""distributable_surplus"": 1500, ""total_provisional"": 2000}, ""expected"": 600.0}","[""ITAA 1936 s 109Y""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/private-company-benefits-division-7a-dividends/in-detail/division-7a-distributable-surplus | |
| Q021,B,$300,300.0,AUD,"The heater costs exactly $300, which is '$300 or less', so it qualifies for an immediate deduction → It is used 100% for a taxable (rental) purpose, so no private-use reduction applies → Immediate deduction = full cost = 300","{""$150"": ""Wrongly apportioned the cost by 50% as if the asset were used half privately"", ""$300"": ""Correct answer"", ""$20"": ""Depreciated the asset over 15 years at the prime cost rate instead of an immediate deduction"", ""$40"": ""Trap: depreciated the asset at the diminishing value rate instead of claiming the immediate deduction available at exactly $300""}","{""formula"": ""cost"", ""params"": {""cost"": 300, ""effective_life"": 15, ""dv_factor"": 2.0, ""half"": 0.5}, ""expected"": 300.0}","[""ITAA 1997 s 40-80(2)"", ""ITAA 1997 s 40-25""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/property-and-land/residential-rental-properties/rental-expenses/depreciating-assets-in-rental-properties | |
| Q022,C,"$21,517",21517.0,AUD,"Apply the carried-forward capital loss BEFORE the discount: 30,000 - 6,000 = 24,000 → Apply the 50% CGT discount: 24,000 x 0.5 = 12,000 (net capital gain) → Taxable income = salary 78,000 + net capital gain 12,000 = 90,000 → Income tax (2023-24 bracket $45,001-$120,000) = 5,092 + (90,000 - 45,000) x 0.325 = 5,092 + 14,625 = 19,717 → Medicare levy = 90,000 x 0.02 = 1,800 → Income tax payable incl Medicare levy = 19,717 + 1,800 = 21,517","{""$20,482"": ""Wrong order: applied the 50% discount to the gain BEFORE deducting the prior-year capital loss (loss applied to the already-halved gain)"", ""$22,552"": ""Ignored the carried-forward $6,000 capital loss entirely"", ""$21,517"": ""Correct answer"", ""$19,717"": ""Forgot to add the 2% Medicare levy on taxable income""}","{""formula"": ""base + ((salary + (gross_gain - prior_loss) * discount_rate) - threshold) * marginal_rate + (salary + (gross_gain - prior_loss) * discount_rate) * medicare_rate"", ""params"": {""salary"": 78000, ""gross_gain"": 30000, ""prior_loss"": 6000, ""discount_rate"": 0.5, ""base"": 5092, ""threshold"": 45000, ""marginal_rate"": 0.325, ""medicare_rate"": 0.02}, ""expected"": 21517.0}","[""ITAA 1997 s 102-5"", ""ITAA 1997 s 102-15"", ""ITAA 1997 s 115-100"", ""ITAA 1997 s 4-10"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/using-capital-losses-to-reduce-capital-gains | |
| Q023,C,"$573,060",573060.0,AUD,"Indexed acquisition costs = 24,400 + 219,600 + 7,850 + 3,090 = 254,940 → Add non-indexable sale costs: 254,940 + 2,000 + 20,000 = 276,940 (total indexed cost base) → Capital gain (indexation method) = 850,000 - 276,940 = 573,060 → Under the indexation method the CGT discount does not apply","{""$309,000"": ""Used the discount method on the unindexed cost base ($177,500) instead of indexation"", ""$286,530"": ""Wrongly applied the 50% discount on top of the indexation method"", ""$573,060"": ""Correct answer"", ""$618,000"": ""Subtracted the unindexed cost base, ignoring indexation entirely""}","{""formula"": ""proceeds - indexed_cost_base"", ""params"": {""proceeds"": 850000, ""indexed_cost_base"": 276940, ""plain_cost_base"": 232000, ""discount_rate"": 0.5}, ""expected"": 573060.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 110-25"", ""ITAA 1997 s 114-1""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/indexing-the-cost-base | |
| Q024,C,"$1,650",1650.0,AUD,"Repayment income = 70,000 + 5,000 (net investment loss added back) + 3,000 (reportable super) = 78,000. → 78,000 is in the 2025-26 $67,001 - $125,000 band: 15c for each $1 over $67,000. → Repayment = (78,000 - 67,000) x 0.15 = 11,000 x 0.15 = 1,650.","{""$900"": ""Omitted the net investment loss add-back from repayment income"", ""$450"": ""Used taxable income only and forgot to add the net investment loss and reportable super to repayment income"", ""$1,650"": ""Correct answer"", ""$11,700"": ""Applied 15% to the whole repayment income (old flat-rate method) instead of only the amount over $67,000""}","{""formula"": ""((taxable_income + net_investment_loss + reportable_super) - threshold) * marginal_rate"", ""params"": {""taxable_income"": 70000, ""net_investment_loss"": 5000, ""reportable_super"": 3000, ""threshold"": 67000, ""marginal_rate"": 0.15}, ""expected"": 1650.0}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q025,D,"$7,500",7500.0,AUD,"Prime cost formula: cost x (days held / 365) x (100% / effective life) → Rate = 100% / 8 years = 12.5% → Decline in value = 60,000 x (365 / 365) x 12.5% = 7,500","{""$3,750"": ""Wrongly halved the straight-line amount"", ""$15,000"": ""Applied the diminishing value 200% rate instead of the prime cost 100% rate"", ""$60,000"": ""Forgot to divide by the effective life (omitted the rate entirely)"", ""$7,500"": ""Correct answer""}","{""formula"": ""cost * (days_held / days_year) * (1 / effective_life)"", ""params"": {""cost"": 60000, ""days_held"": 365, ""days_year"": 365, ""effective_life"": 8, ""dv_factor"": 2.0}, ""expected"": 7500.0}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-75""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules-capital-allowances/prime-cost-straight-line-and-diminishing-value-methods | |
| Q026,D,"$48,053",48053.0,AUD,"Add the taxable values of all fringe benefits that included GST: 9,900 (car) + 8,800 (car) + 4,400 (meals) = 23,100 → Multiply by the higher (type 1) gross-up rate of 2.0802 because a GST credit is available → 23,100 x 2.0802 = 48,053 (rounded to nearest dollar)","{""$23,100"": ""Forgot to gross up the taxable value at all"", ""$43,585"": ""Used the type 2 (lower) gross-up rate 1.8868 instead of the type 1 rate 2.0802"", ""$22,585"": ""Applied the 47% FBT rate at the gross-up step instead of producing the grossed-up amount"", ""$48,053"": ""Correct answer""}","{""formula"": ""round(gst_inclusive_value * type1_rate)"", ""params"": {""gst_inclusive_value"": 23100, ""type1_rate"": 2.0802, ""type2_rate"": 1.8868}, ""expected"": 48053.0}","[""FBTAA 1986 s 5B"", ""FBTAA 1986 s 136(1)""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/fringe-benefits-tax/calculating-your-fbt | |
| Q027,A,-$288,-288.0,AUD,"Gross rent = rent 28,600 + other rental income 400 = 29,000 → Deductible expenses = interest 19,200 + council rates 2,100 + insurance 1,300 + agent fees 2,288 + repairs 900 + capital works 3,500 = 29,288 → The $4,500 new pergola is a capital improvement, not an immediate repair, so it is NOT included in current-year expenses → Net rental income or loss = 29,000 − 29,288 = −288 (a net rental loss)","{""-$288"": ""Correct answer"", ""-$4,788"": ""Wrongly deducted the $4,500 new pergola (a capital improvement) as an immediate expense"", ""-$688"": ""Forgot the $400 of other rental-related income in gross rent"", ""$3,212"": ""Omitted the $3,500 capital works (Division 43) deduction""}","{""formula"": ""(rent + other_income) - (interest + council_rates + insurance + agent_fees + repairs + capital_works)"", ""params"": {""rent"": 28600, ""other_income"": 400, ""interest"": 19200, ""council_rates"": 2100, ""insurance"": 1300, ""agent_fees"": 2288, ""repairs"": 900, ""capital_works"": 3500, ""pergola"": 4500}, ""expected"": -288.0}","[""ITAA 1997 s 8-1"", ""ITAA 1997 s 6-5"", ""ITAA 1997 Div 43"", ""ITAA 1997 s 43-25""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/worksheet-work-out-your-net-rental-income-or-loss | |
| Q028,C,$456.00,456.0,AUD,"Ordinary time earnings = salary $3,200 + higher duties allowance $600 = $3,800 (overtime and overtime meal allowance are excluded) → Super guarantee rate (payment made 3 July 2025) = 12% (rate kept fixed from the base example) → SG = 3,800 x 12% = $456","{""$476.71"": ""Included overtime and the overtime meal allowance in OTE"", ""$473.11"": ""Included overtime in OTE"", ""$456.00"": ""Correct answer"", ""$384.00"": ""Left out the higher duties allowance, which is part of OTE""}","{""formula"": ""(salary + higher_duties) * sg_rate"", ""params"": {""salary"": 3200, ""higher_duties"": 600, ""overtime"": 142.55, ""overtime_meal"": 30, ""sg_rate"": 0.12}, ""expected"": 456.0}","[""Superannuation Guarantee (Administration) Act 1992 s 6(1)"", ""Superannuation Guarantee (Administration) Act 1992 s 19""]",https://www.ato.gov.au/businesses-and-organisations/super-for-employers/paying-super-contributions/how-much-super-to-pay | |
| Q029,A,"$29,046.00",29046.0,AUD,"Total fringe benefits taxable amount = type 1 grossed-up (48,053) + type 2 grossed-up (13,747) = 61,800 → Multiply by the FBT rate of 47% → 61,800 x 0.47 = 29,046","{""$29,046.00"": ""Correct answer"", ""$61,800.00"": ""Reported the fringe benefits taxable amount without applying the FBT rate"", ""$27,810.00"": ""Used a 45% rate instead of the 47% FBT rate"", ""$60,421.49"": ""Grossed up a second time by 2.0802 before applying the FBT rate""}","{""formula"": ""fringe_benefits_taxable_amount * fbt_rate"", ""params"": {""fringe_benefits_taxable_amount"": 61800, ""fbt_rate"": 0.47, ""type1_rate"": 2.0802}, ""expected"": 29046.0}","[""FBTAA 1986 s 66"", ""FBTAA 1986 s 5B""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/fringe-benefits-tax/calculating-your-fbt | |
| Q030,C,$0,0.0,AUD,"The sale of existing residential premises is an input-taxed sale → On an input-taxed sale the seller is not liable for GST and does not charge GST → The 1/11 GST calculation does NOT apply, so GST payable = $0","{""$66,000"": ""Applied 10% GST to the sale price, ignoring that residential premises are input-taxed"", ""$60,000"": ""Wrongly applied the 1/11 GST fraction to the GST-inclusive price as if it were a taxable sale"", ""$0"": ""Correct answer"", ""$600,000"": ""Reported the GST-exclusive price instead of recognising there is no GST at all""}","{""formula"": ""0 * sale_price"", ""params"": {""sale_price"": 660000, ""gst_fraction"": 0.09090909090909091, ""gst_rate"": 0.1}, ""expected"": 0.0}","[""GST Act 1999 s 40-65"", ""GST Act 1999 s 9-30(2)""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/when-to-charge-gst-and-when-not-to/input-taxed-sales/residential-premises | |
| Q031,D,"$17,500",17500.0,AUD,"2018-19 concessional contributions cap = $25,000 (cap kept fixed from the base example) → Concessional contributions made = $7,500 super guarantee → Unused cap accumulated = 25,000 - 7,500 = $17,500","{""$32,500"": ""Added the contributions to the cap instead of subtracting them"", ""$25,000"": ""Forgot to subtract the $7,500 already contributed"", ""$20,000"": ""Used a later year's $27,500 cap instead of the 2018-19 cap of $25,000"", ""$17,500"": ""Correct answer""}","{""formula"": ""annual_cap_1819 - contributions_1819"", ""params"": {""annual_cap_1819"": 25000, ""contributions_1819"": 7500, ""annual_cap_2122"": 27500}, ""expected"": 17500.0}","[""ITAA 1997 s 291-20""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/concessional-contributions-cap | |
| Q032,B,$990.00,990.0,AUD,"Gross taxable value of the expense payment fringe benefit = amount paid = 1,800 → Otherwise deductible amount = 1,800 x 45% = 810 → Taxable value = 1,800 - 810 = 990 → FBT rate for the year is 47% and loan/expense benefits with no GST credit gross up at the Type 2 rate of 1.8868, but the taxable value itself is 990 before grossing up","{""$271.69"": ""Grossed up the deductible reduction by the Type 2 factor before subtracting"", ""$990.00"": ""Correct answer"", ""$1,800.00"": ""Used the full bill as the taxable value, ignoring the otherwise deductible rule"", ""$810.00"": ""Reported the deductible (otherwise deductible) portion as the taxable value instead of the private portion""}","{""formula"": ""bill - bill * deductible_pct"", ""params"": {""bill"": 1800, ""deductible_pct"": 0.45}, ""expected"": 990.0}","[""FBTAA 1986 s 23"", ""FBTAA 1986 s 24""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q033,C,"$132,500",132500.0,AUD,"Capital proceeds = 880,000 → Cost base = 615,000 (purchase price + acquisition costs + disposal costs) → Capital gain = 880,000 - 615,000 = 265,000 → Apply 50% CGT discount (held more than 12 months, Australian resident): 265,000 x 0.5 = 132,500","{""$66,250"": ""Applied the 50% discount twice"", ""$440,000"": ""Applied the discount to the sale proceeds instead of the gain"", ""$132,500"": ""Correct answer"", ""$265,000"": ""Reported the gross capital gain without applying the 50% CGT discount""}","{""formula"": ""(proceeds - cost_base) * discount_rate"", ""params"": {""proceeds"": 880000, ""cost_base"": 615000, ""discount_rate"": 0.5}, ""expected"": 132500.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 110-25"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q034,D,"$5,400",5400.0,AUD,"Statutory formula method: taxable value = (A x B x C / D) - E → A = base value = 45,000; B = statutory rate = 20% (flat 20% applies from 1 April 2014 where there is no pre-existing commitment); C = days available for private use = 219; D = days in FBT year = 365; E = employee contribution = 0 → (45,000 x 0.20 x 219) / 365 = 5,400 (rounded to nearest dollar)","{""$9,000"": ""Forgot to apportion by the days the car was available (used the full-year value)"", ""$15,000"": ""Inverted the days fraction (multiplied by 365/219 instead of 219/365)"", ""$7,020"": ""Used the 26% pre-existing-commitment rate (under 15,000 km) instead of the flat 20% statutory rate"", ""$5,400"": ""Correct answer""}","{""formula"": ""base_value * statutory_rate * days_available / days_in_year"", ""params"": {""base_value"": 45000, ""statutory_rate"": 0.2, ""days_available"": 219, ""days_in_year"": 365, ""employee_contribution"": 0}, ""expected"": 5400.0}","[""FBTAA 1986 s 9"", ""FBTAA 1986 s 162C""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2017-completing-your-return/fringe-benefit-categories/a-cars-using-the-statutory-formula | |
| Q035,B,"$250,714.29",250714.29,AUD,"Non-main-residence days = 3,000 (Noor) + 900 (Lakshmi) = 3,900 → Total days = 3,900 + 4,500 (Idris, main residence) = 8,400 → Taxable proportion = 540,000 x (3,900 / 8,400) = 250,714 (rounded to nearest dollar) → The 50% discount may then be applied separately as the combined ownership exceeded 12 months","{""$468,000.00"": ""Divided by main-residence days only instead of total ownership days"", ""$250,714.29"": ""Correct answer"", ""$289,285.71"": ""Used main-residence days in the numerator instead of non-main-residence days"", ""$125,357.14"": ""Applied the 50% discount, but the question asks for the taxable proportion before the discount""}","{""formula"": ""total_gain * non_main_days / total_days"", ""params"": {""total_gain"": 540000, ""non_main_days"": 3900, ""total_days"": 8400, ""discount_rate"": 0.5}, ""expected"": 250714.29}","[""ITAA 1997 s 118-195"", ""ITAA 1997 s 118-185"", ""ITAA 1997 s 128-15""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/inherited-assets-and-capital-gains-tax/calculating-a-partial-exemption-for-inherited-property | |
| Q036,D,"$11,167.00",11167.0,AUD,"The $1,500 disaster relief payment is exempt income and Priya's age (67) does not change these rates, so both are ignored → Income tax (2023-24 bracket $45,001-$120,000) = 5,092 + (60,000 − 45,000) × 0.325 = 5,092 + 4,875 = 9,967 → Medicare levy = 60,000 × 0.02 = 1,200 → Income tax payable incl Medicare levy = 9,967 + 1,200 = 11,167","{""$20,700.00"": ""Applied 32.5% to the whole income instead of only the amount over $45,000 (and dropped the base amount)"", ""$11,684.50"": ""Wrongly added the $1,500 exempt disaster relief payment to taxable income"", ""$9,967.00"": ""Forgot to add the 2% Medicare levy"", ""$11,167.00"": ""Correct answer""}","{""formula"": ""base + (taxable_income - threshold) * marginal_rate + taxable_income * medicare_rate"", ""params"": {""taxable_income"": 60000, ""base"": 5092, ""threshold"": 45000, ""marginal_rate"": 0.325, ""medicare_rate"": 0.02, ""disaster_relief"": 1500, ""age"": 67}, ""expected"": 11167.0}","[""ITAA 1997 s 4-10"", ""Income Tax Rates Act 1986 Sch 7"", ""Medicare Levy Act 1986 s 6"", ""ITAA 1997 s 6-20""]",https://www.ato.gov.au/tax-rates-and-codes/tax-rates-australian-residents | |
| Q037,B,"$7,000",7000.0,AUD,"Apportioned purchase price of the 1,000 sqm lot = 1,000 / 2,500 x 275,000 = 110,000 → Margin = sale price - apportioned purchase price = 187,000 - 110,000 = 77,000 → GST = one eleventh of the margin = 77,000 / 11 = 7,000","{""$17,000"": ""Applied 1/11 to the full sale price instead of the margin"", ""$7,000"": ""Correct answer"", ""-$8,000"": ""Subtracted the whole block's $275,000 cost instead of the apportioned $110,000 for the lot sold"", ""$7,700"": ""Took 10% of the GST-inclusive margin instead of 1/11""}","{""formula"": ""(sale_price - apportioned_cost) / 11"", ""params"": {""sale_price"": 187000, ""apportioned_cost"": 110000, ""total_block_cost"": 275000}, ""expected"": 7000.0}","[""GST Act s 75-10"", ""GST Act s 75-15""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/property/gst-and-the-margin-scheme/calculating-the-gst-payable | |
| Q038,D,"$25,000",25000.0,AUD,"Margin = sale price - purchase price = 935,000 - 660,000 = 275,000 → Under the margin scheme, GST = one eleventh of the margin → GST = 275,000 / 11 = 25,000","{""$27,500"": ""Took 10% of the GST-inclusive margin instead of 1/11"", ""$85,000"": ""Applied 1/11 to the full sale price instead of the margin (ignored the margin scheme)"", ""$12,500"": ""Halved the GST as if a CGT-style 50% discount applied"", ""$25,000"": ""Correct answer""}","{""formula"": ""(sale_price - purchase_price) / 11"", ""params"": {""sale_price"": 935000, ""purchase_price"": 660000}, ""expected"": 25000.0}","[""A New Tax System (Goods and Services Tax) Act 1999 s 75-5"", ""GST Act s 75-10""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/property/gst-and-the-margin-scheme/calculating-the-gst-payable | |
| Q039,D,"-$8,200.00",-8200.0,AUD,"Apportion general expenses to the 45 weeks available for rent: (45 / 52) x 42,900 = 37,125 → Add the fully deductible agent commission and advertising: 37,125 + 2,275 = 39,400 total deductions → Rental loss = rent 31,200 - deductions 39,400 = -8,200","{""-$7,893.75"": ""Apportioned the agent commission/advertising too, instead of claiming it in full"", ""$23,150.00"": ""Apportioned using the 4 private-use weeks instead of the 48 weeks available for rent"", ""-$13,975.00"": ""Deducted the full year of expenses without apportioning for the 4 weeks of private use"", ""-$8,200.00"": ""Correct answer""}","{""formula"": ""rent_received - ((weeks_available / weeks_in_year) * apportionable_expenses + agent_costs)"", ""params"": {""rent_received"": 31200, ""apportionable_expenses"": 42900, ""weeks_available"": 45, ""weeks_in_year"": 52, ""agent_costs"": 2275}, ""expected"": -8200.0}","[""ITAA 1997 s 8-1"", ""IT 2167""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q040,A,"$30,000",30000.0,AUD,"Subtract the prior-year net capital loss first: 80,000 - 14,000 = 66,000 → Subtract the current-year capital loss: 66,000 - 6,000 = 60,000 → Apply the 50% CGT discount to the remaining gain: 60,000 x 0.5 = 30,000","{""$30,000"": ""Correct answer"", ""$37,000"": ""Subtracted only the current-year loss and ignored the carried-forward prior-year loss"", ""$20,000"": ""Trap: applied the 50% discount before subtracting the losses (wrong order)"", ""$60,000"": ""Subtracted both losses but forgot to apply the 50% discount""}","{""formula"": ""(property_gain - prior_loss - current_loss) * discount_rate"", ""params"": {""property_gain"": 80000, ""current_loss"": 6000, ""prior_loss"": 14000, ""discount_rate"": 0.5}, ""expected"": 30000.0}","[""ITAA 1997 s 102-5"", ""ITAA 1997 s 102-15"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q041,B,"$7,200",7200.0,AUD,"Employer SG = OTE × 12% = 90,000 × 0.12 = 10,800 → Salary-sacrifice contributions = 12,000 (these are concessional and count towards the cap) → Total concessional contributions used = 10,800 + 12,000 = 22,800 → Headroom = concessional cap − contributions used = 30,000 − 22,800 = 7,200","{""$7,650"": ""Used the 2024-25 SG rate of 11.5% instead of the 2025-26 rate of 12%"", ""$7,200"": ""Correct answer"", ""$18,000"": ""Counted only the salary sacrifice against the cap and ignored the employer SG (which is also concessional)"", ""$19,200"": ""Counted only the employer SG and ignored the $12,000 salary-sacrifice amount""}","{""formula"": ""cc_cap - (ote*sg_rate + salary_sacrifice)"", ""params"": {""ote"": 90000, ""sg_rate"": 0.12, ""salary_sacrifice"": 12000, ""cc_cap"": 30000, ""old_sg_rate"": 0.115}, ""expected"": 7200.0}","[""ITAA 1997 s 291-20"", ""Superannuation Guarantee (Administration) Act 1992 s 19""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/how-to-save-more-in-your-super/salary-sacrificing-super | |
| Q042,C,$60.20,60.2,AUD,"Cost is $301, which is MORE than $300, so no immediate deduction is available → Diminishing value rate = 200% / 10 years = 20% → Decline in value = 301 x (365/365) x (2.0/10) = 60.20","{""$30.10"": ""Used the prime cost 100% rate instead of the diminishing value 200% rate"", ""$45.15"": ""Used the old 150% diminishing value rate (for assets first held before 10 May 2006) instead of the 200% rate"", ""$60.20"": ""Correct answer"", ""$301.00"": ""Trap: claimed the full $301 as an immediate deduction, but at $301 the asset is over the $300 threshold and must be depreciated""}","{""formula"": ""cost * (days_held / days_year) * (dv_factor / effective_life)"", ""params"": {""cost"": 301, ""days_held"": 365, ""days_year"": 365, ""effective_life"": 10, ""dv_factor"": 2.0}, ""expected"": 60.2}","[""ITAA 1997 s 40-80(2)"", ""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-70""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/property-and-land/residential-rental-properties/rental-expenses/depreciating-assets-in-rental-properties | |
| Q043,A,$427.80,427.8,AUD,"Kept taxable income within the 2024-25 single shade-in band ($27,222 lower to $34,027 upper threshold) → In the shade-in range the levy = 10c for each $1 of taxable income over the lower threshold → Reduced Medicare levy = (31,500 - 27,222) x 0.10 = 4,278 x 0.10 = 427.80","{""$427.80"": ""Correct answer"", ""$85.56"": ""Applied the 2% rate to the excess over the threshold instead of the 10% shade-in rate"", ""$630.00"": ""Charged the full 2% Medicare levy and ignored the low-income reduction"", ""$3,150.00"": ""Applied the 10% shade-in rate to the whole taxable income instead of only the amount over the lower threshold""}","{""formula"": ""(taxable_income - lower_threshold) * shade_in_rate"", ""params"": {""taxable_income"": 31500, ""lower_threshold"": 27222, ""shade_in_rate"": 0.1, ""full_rate"": 0.02}, ""expected"": 427.8}","[""Medicare Levy Act 1986 s 7"", ""Medicare Levy Act 1986 s 8""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy/medicare-levy-reduction/medicare-levy-reduction-for-low-income-earners | |
| Q044,D,"$7,500",7500.0,AUD,"Quarterly earnings = $78,000, which (like the base example) exceeds the maximum contribution base, so SG is capped at the MCB of $62,500 → Use the lesser of earnings and the MCB = $62,500 (MCB kept fixed from the base example) → SG = 62,500 x 12% = $7,500 (no SG is payable on OTE above $62,500)","{""$9,360"": ""Applied SG to the full $78,000, ignoring the maximum contribution base cap"", ""$62,500"": ""Reported the MCB amount itself instead of 12% SG on it"", ""$1,860"": ""Applied SG only to the earnings above the MCB"", ""$7,500"": ""Correct answer""}","{""formula"": ""min(earnings, mcb) * sg_rate"", ""params"": {""earnings"": 78000, ""mcb"": 62500, ""sg_rate"": 0.12}, ""expected"": 7500.0}","[""Superannuation Guarantee (Administration) Act 1992 s 15"", ""Superannuation Guarantee (Administration) Act 1992 s 19""]",https://www.ato.gov.au/businesses-and-organisations/super-for-employers/paying-super-contributions/how-much-super-to-pay | |
| Q045,B,"$1,200",1200.0,AUD,"The $8,000 to rectify defects existing at purchase are INITIAL repairs – capital in nature, not an immediate repair deduction → The $1,200 to fix the hot-water system after wear and tear during the rental period IS an immediately deductible repair → Immediate repairs deduction = 1,200 (the $8,000 is claimed as capital works at 2.5% per year instead)","{""$1,400"": ""Added the first-year 2.5% capital works deduction on the initial repairs to the genuine repair instead of treating them separately"", ""$1,200"": ""Correct answer"", ""$8,000"": ""Claimed only the capital initial repairs as an immediate deduction and missed the genuine $1,200 repair"", ""$9,200"": ""Trap: claimed both amounts as immediate repairs, but the $8,000 initial repairs are capital and not deductible as a repair""}","{""formula"": ""ordinary_repair"", ""params"": {""initial_repairs"": 8000, ""ordinary_repair"": 1200, ""capital_works_rate"": 0.025}, ""expected"": 1200.0}","[""ITAA 1997 s 25-10"", ""ITAA 1997 s 25-10(3)"", ""ITAA 1997 Div 43""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/property-and-land/residential-rental-properties/rental-expenses/repair-and-maintenance-expenses | |
| Q046,A,"$2,195",2195.0,AUD,"Step 1: tax payable on actual taxable income $29,000 (incl Medicare levy) = 2,632.00 → Step 2: tax payable disregarding foreign income, on taxable income $20,500 (no Medicare levy) = 437.00 → Step 3: offset limit = Step 1 - Step 2 = 2,632.00 - 437.00 = 2,195.00 → Although Yuki paid $3,200 foreign tax, her offset is limited to $2,195.00","{""$2,195"": ""Correct answer"", ""$3,200"": ""Claimed the full $3,200 foreign tax paid without applying the offset limit"", ""$3,069"": ""Added Step 1 and Step 2 instead of subtracting, then capped at foreign tax paid"", ""$2,632"": ""Used only the Step 1 tax figure as the limit, forgetting to subtract Step 2""}","{""formula"": ""step1_tax - step2_tax"", ""params"": {""step1_tax"": 2632.0, ""step2_tax"": 437.0, ""foreign_tax_paid"": 3200}, ""expected"": 2195.0}","[""ITAA 1997 s 770-10"", ""ITAA 1997 s 770-75""]",https://www.ato.gov.au/forms-and-instructions/foreign-income-tax-offset-rules-guide-2024/calculate-your-fito-or-offset-limit | |
| Q047,A,"$9,375.00",9375.0,AUD,"Business-use percentage = 9,750 ÷ 13,000 × 100 = 75% → Deduction = total car expenses × business-use percentage → = 12,500 × 75% = 9,375","{""$9,375.00"": ""Correct answer"", ""$16,666.67"": ""Inverted the ratio (total ÷ business instead of business ÷ total)"", ""$12,500.00"": ""Claimed all car expenses without apportioning by the business-use percentage"", ""$12,499.25"": ""Subtracted the business-use fraction from the expenses instead of multiplying""}","{""formula"": ""total_expenses * (business_km/total_km)"", ""params"": {""total_expenses"": 12500, ""business_km"": 9750, ""total_km"": 13000}, ""expected"": 9375.0}","[""ITAA 1997 s 28-90"", ""ITAA 1997 s 28-100"", ""ITAA 1997 s 8-1""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/income-and-deductions-for-business/deductions/deductions-for-motor-vehicle-expenses/logbook-method | |
| Q048,C,"$28,245.60",28245.6,AUD,"Gross up the car fringe benefit using the type 1 rate: 28,000 x 2.0802 = 58,245.60 → The grossed-up amount exceeds the public benevolent institution capping threshold of 30,000 → Aggregate non-exempt amount = grossed-up amount - cap = 58,245.60 - 30,000 = 28,245.60","{""$58,245.60"": ""Forgot to subtract the $30,000 capping threshold"", ""$22,830.40"": ""Used the type 2 gross-up rate 1.8868 instead of the type 1 rate 2.0802"", ""$28,245.60"": ""Correct answer"", ""-$2,000.00"": ""Subtracted the cap from the ungrossed-up taxable value instead of grossing up first""}","{""formula"": ""car_value * type1_rate - exemption_cap"", ""params"": {""car_value"": 28000, ""type1_rate"": 2.0802, ""exemption_cap"": 30000}, ""expected"": 28245.6}","[""FBTAA 1986 s 5B(1E)"", ""FBTAA 1986 s 57A"", ""FBTAA 1986 s 65J""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2024-instructions/worked-examples-not-for-profit-employers-completing-your-fbt-return | |
| Q049,D,$143,143.0,AUD,Only the 204 hours from 1 March to 30 June 2025 have a contemporaneous record and are claimable; the 315 estimated hours are not accepted → Deduction = 204 × $0.70 = $142.80 → Cents are disregarded: deduction = $143,"{""$220"": ""Used only the estimated-hours period instead of the recorded hours"", ""$363"": ""Included the 315 estimated hours that have no contemporaneous record"", ""$137"": ""Used the prior-year 67 cents rate instead of the 2024-25 rate of 70 cents"", ""$143"": ""Correct answer""}","{""formula"": ""round(eligible_hours * rate)"", ""params"": {""eligible_hours"": 204, ""estimated_hours"": 315, ""rate"": 0.7}, ""expected"": 143.0}","[""ITAA 1997 s 8-1"", ""PCG 2023/1""]",https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/deductions-you-can-claim/work-related-deductions/working-from-home-expenses/fixed-rate-method | |
| Q050,A,"$60,000.00",60000.0,AUD,"Margin = sale price - approved valuation on the date Bruno purchased = 1,045,000 - 385,000 = 660,000 → Under the margin scheme, GST = one eleventh of the margin → GST = 660,000 / 11 = 60,000","{""$60,000.00"": ""Correct answer"", ""$62,272.73"": ""Used the $360,000 actual purchase price instead of the $385,000 approved valuation for the margin"", ""$95,000.00"": ""Applied 1/11 to the full sale price instead of the margin"", ""$66,000.00"": ""Took 10% of the GST-inclusive margin instead of 1/11""}","{""formula"": ""(sale_price - approved_valuation) / 11"", ""params"": {""sale_price"": 1045000, ""approved_valuation"": 385000, ""actual_purchase_price"": 360000}, ""expected"": 60000.0}","[""GST Act s 75-10"", ""GST Act s 75-11""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/property/gst-and-the-margin-scheme/calculating-the-gst-payable | |
| Q051,B,"$10,377.40",10377.4,AUD,"Total taxable value of the reportable fringe benefits = 4,200 + 1,300 = 5,500 → Reportable fringe benefits are always grossed up at the Type 2 (lower) gross-up rate of 1.8868, regardless of whether the benefits are Type 1 or Type 2 → RFBA = 5,500 x 1.8868 = 10,377.40, reported as 10,377","{""$5,500.00"": ""Reported the total taxable value without grossing it up"", ""$10,377.40"": ""Correct answer"", ""$4,877.38"": ""Applied the 47% FBT rate to the grossed-up amount instead of reporting the RFBA"", ""$11,441.10"": ""Used the Type 1 (higher) gross-up rate of 2.0802 instead of the Type 2 rate""}","{""formula"": ""(car_tv + housing_tv) * type2_gross_up"", ""params"": {""car_tv"": 4200, ""housing_tv"": 1300, ""type2_gross_up"": 1.8868}, ""expected"": 10377.4}","[""FBTAA 1986 s 135P"", ""ITAA 1997 s 6-1""]",https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/reportable-fringe-benefits-for-employees/consequences-of-having-a-reportable-fringe-benefits-amount | |
| Q052,B,"$22,207.00",22207.0,AUD,"Kept taxable income within the 2023-24 $45,001-$120,000 bracket ($5,092 plus 32.5c for each $1 over $45,000) → Tax on income = 5,092 + (92,000 - 45,000) x 0.325 = 5,092 + 15,275 = 20,367 → Medicare levy = 92,000 x 0.02 = 1,840 → Income tax payable incl Medicare levy = 20,367 + 1,840 = 22,207","{""$20,367.00"": ""Forgot to add the 2% Medicare levy"", ""$22,207.00"": ""Correct answer"", ""$20,367.02"": ""Added a flat 0.02 instead of 2% of taxable income for the Medicare levy"", ""$31,740.00"": ""Applied the 32.5% marginal rate to the whole income instead of only the amount over $45,000 (and dropped the base)""}","{""formula"": ""base + (taxable_income - threshold) * marginal_rate + taxable_income * medicare_rate"", ""params"": {""taxable_income"": 92000, ""base"": 5092, ""threshold"": 45000, ""marginal_rate"": 0.325, ""medicare_rate"": 0.02}, ""expected"": 22207.0}","[""ITAA 1997 s 4-10"", ""Income Tax Rates Act 1986 Sch 7"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/forms-and-instructions/foreign-income-tax-offset-rules-guide-2024/calculate-your-fito-or-offset-limit | |
| Q053,A,"$13,420",13420.0,AUD,"Total interest for year 1 = 264,000 x 6.10% = 16,104 → Deductible portion = total interest x (rental property loan / total borrowings) → = 16,104 x (220,000 / 264,000) = 13,420","{""$13,420"": ""Correct answer"", ""$16,104"": ""Claimed interest on the whole $209,000 loan, ignoring the private car portion"", ""$6,710"": ""Halved the deductible interest (confused the total deduction with one owner's 50% share)"", ""$2,684"": ""Apportioned using the private ($39,000) portion instead of the rental ($170,000) portion""}","{""formula"": ""total_loan * interest_rate * (rental_loan / total_loan)"", ""params"": {""total_loan"": 264000, ""rental_loan"": 220000, ""interest_rate"": 0.061}, ""expected"": 13420.0}","[""ITAA 1997 s 8-1"", ""TR 2000/2""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q054,D,"$31,203.00",31203.0,AUD,"Total taxable value of type 1 fringe benefits = 13,500 (car) + 1,500 (meal expense) = 15,000 → Multiply by the higher (type 1) gross-up rate of 2.0802 → 15,000 x 2.0802 = 31,203.00","{""$15,000.00"": ""Forgot to apply the gross-up rate"", ""$28,082.70"": ""Omitted the $1,500 GST-creditable meal expense fringe benefit"", ""$28,302.00"": ""Used the type 2 gross-up rate 1.8868 instead of the type 1 rate 2.0802"", ""$31,203.00"": ""Correct answer""}","{""formula"": ""(car_value + meal_expense) * type1_rate"", ""params"": {""car_value"": 13500, ""meal_expense"": 1500, ""type1_rate"": 2.0802, ""type2_rate"": 1.8868}, ""expected"": 31203.0}","[""FBTAA 1986 s 5B"", ""FBTAA 1986 s 136(1)""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/fbt-return-2026-calculation-details-for-taxable-employers | |
| Q055,C,"$14,662.98",14662.98,AUD,"Amount of loan not repaid by end of previous (2014) income year P = 82,000 → 2015 benchmark interest rate I = 5.95% (0.0595); remaining term T = 7 years → Step 1: P x I = 82,000 x 0.0595 = 4,879.00 → Step 2: 1 / (1 + I) = 1 / 1.0595 = 0.943841435 → Step 3: 0.943841435 ^ 7 = 0.667257208 → Step 4: 1 - 0.667257208 = 0.332742732 → Step 5: 4,879.00 / 0.332742732 = 14,663 (rounded to nearest dollar)","{""$11,714.29"": ""Used straight-line principal repayment (loan / term) and ignored interest entirely"", ""$16,649.55"": ""Used remaining term of 6 years instead of 7"", ""$14,662.98"": ""Correct answer"", ""$4,879.00"": ""Charged only one year's benchmark interest instead of amortising the loan over the remaining term""}","{""formula"": ""(P * I) / (1 - (1 / (1 + I)) ** T)"", ""params"": {""P"": 82000, ""I"": 0.0595, ""T"": 7}, ""expected"": 14662.98}","[""ITAA 1936 s 109E"", ""ITAA 1936 s 109N""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/private-company-benefits-division-7a-dividends/in-detail/division-7a-loans | |
| Q056,B,"$71,766.90",71766.9,AUD,"Total car fringe benefits = 18,000 (Tobias) + 16,500 (Ingrid) = 34,500 → Car fringe benefits are type 1 benefits (GST credit available), so use the higher gross-up rate 2.0802 → 34,500 x 2.0802 = 71,766.90","{""$33,730.44"": ""Applied the 47% FBT rate to the aggregate amount instead of reporting the grossed-up aggregate"", ""$71,766.90"": ""Correct answer"", ""$34,500.00"": ""Forgot to apply the gross-up rate"", ""$65,094.60"": ""Used the type 2 gross-up rate 1.8868 instead of the type 1 rate 2.0802""}","{""formula"": ""(mark_car + sam_car) * type1_rate"", ""params"": {""mark_car"": 18000, ""sam_car"": 16500, ""type1_rate"": 2.0802, ""type2_rate"": 1.8868}, ""expected"": 71766.9}","[""FBTAA 1986 s 5B"", ""FBTAA 1986 s 65J""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2024-instructions/worked-examples-not-for-profit-employers-completing-your-fbt-return | |
| Q057,A,$110.27,110.27,AUD,"Prime cost formula: cost x (days held / 365) x (100% / effective life) → Rate = 100% / 8 years = 12.5% → Decline in value = 3,500 x (92 / 365) x 12.5% = 110.27, rounded to 110","{""$110.27"": ""Correct answer"", ""$437.50"": ""Claimed a full year's deduction, ignoring the 92-day part-year apportionment"", ""$220.55"": ""Applied the diminishing value 200% rate instead of the prime cost 100% rate"", ""$882.19"": ""Apportioned by days but forgot to apply the 1/effective-life rate""}","{""formula"": ""cost * (days_held / days_year) * (1 / effective_life)"", ""params"": {""cost"": 3500, ""days_held"": 92, ""days_year"": 365, ""effective_life"": 8, ""dv_factor"": 2.0}, ""expected"": 110.27}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-75""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules-capital-allowances/prime-cost-straight-line-and-diminishing-value-methods | |
| Q058,D,$293.31,293.31,AUD,"The minor benefits exemption applies only where the notional taxable value is LESS than $300 → Here the value is exactly $300, so the exemption does NOT apply and the benefit is taxable → It is a Type 1 benefit (GST credit available): grossed-up value = $300 x 2.0802 = $624.06 → FBT payable = $624.06 x 47% = $293.31","{""$141.00"": ""Applied 47% FBT to the taxable value without grossing it up"", ""$266.04"": ""Used the Type 2 gross-up rate (1.8868) even though a GST credit was available"", ""$0.00"": ""Assumed $300 qualifies for the minor benefits exemption, but the test is LESS than $300, so the exemption does not apply"", ""$293.31"": ""Correct answer""}","{""formula"": ""round(notional_value * gross_up_t1 * fbt_rate, 2)"", ""params"": {""notional_value"": 300, ""gross_up_t1"": 2.0802, ""gross_up_t2"": 1.8868, ""fbt_rate"": 0.47}, ""expected"": 293.31}","[""FBTAA 1986 s 58P"", ""FBTAA 1986 s 136(1)""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/fringe-benefits-tax/exemptions-concessions-and-other-ways-to-reduce-fbt/minor-benefits-exemption | |
| Q059,D,"$35,063",35063.0,AUD,"Tax-free limit = base + (service × years) = 11,985 + (5,994 × 8) = 11,985 + 47,952 = 59,937 → Marcus's age (61) and the $7,000 unused annual leave are not used in this calculation: the tax-free limit depends only on completed years of service, and unused annual leave is taxed separately (not part of the genuine redundancy payment) → ETP excess = genuine redundancy part − tax-free limit = 95,000 − 59,937 = 35,063","{""$77,021"": ""Used only one year's service amount instead of multiplying by the 8 completed years"", ""$59,937"": ""Reported the tax-free limit itself instead of the ETP amount in excess of it"", ""$42,063"": ""Wrongly added the $7,000 unused annual leave into the genuine redundancy part (annual leave is taxed separately, not part of it)"", ""$35,063"": ""Correct answer""}","{""formula"": ""genuine_part - (base + service*years)"", ""params"": {""genuine_part"": 95000, ""base"": 11985, ""service"": 5994, ""years"": 8, ""age"": 61, ""annual_leave"": 7000}, ""expected"": 35063.0}","[""ITAA 1997 s 83-170"", ""ITAA 1997 s 83-175"", ""ITAA 1997 s 82-10""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/engaging-a-worker/when-a-worker-leaves-your-business/taxation-of-termination-payments/redundancy-and-early-retirement | |
| Q060,D,$250,250.0,AUD,"Termination value (sale proceeds) = 2,100 → Adjustable value at time of sale = 1,850 → Termination value exceeds adjustable value, so the excess is assessable: 2,100 - 1,850 = 250","{""-$250"": ""Subtracted the wrong way round (treated it as a deductible amount instead of assessable)"", ""-$300"": ""Compared the termination value with the original cost instead of the adjustable value"", ""$550"": ""Used the original cost instead of the termination value"", ""$250"": ""Correct answer""}","{""formula"": ""termination_value - adjustable_value"", ""params"": {""termination_value"": 2100, ""adjustable_value"": 1850, ""cost"": 2400}, ""expected"": 250.0}","[""ITAA 1997 s 40-285"", ""ITAA 1997 s 40-300""]",https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2020/what-happens-if-you-no-longer-hold-or-use-a-depreciating-asset | |
| Q061,A,"$16,280.00",16280.0,AUD,"PAYG instalment (option 2) = instalment income (T1) × instalment rate (T2) → = $148,000 × 11% → = $16,280","{""$16,280.00"": ""Correct answer"", ""$1,345,454.55"": ""Divided by the instalment rate instead of multiplying by it"", ""$148,000.00"": ""Reported the instalment income as the amount payable without applying the instalment rate"", ""$162.80"": ""Divided the already-decimal rate by 100 again, treating 11% as 0.11%""}","{""formula"": ""instalment_income * rate"", ""params"": {""instalment_income"": 148000, ""rate"": 0.11}, ""expected"": 16280.0}","[""TAA 1953 Sch 1 s 45-110"", ""TAA 1953 Sch 1 s 45-15""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/payg-instalments/calculate-your-payg-instalments | |
| Q062,A,$0.00,0.0,AUD,"Division 293 tax applies to the excess OVER $250,000, not at the threshold. → Excess = 250,000 - 250,000 = 0. → Taxable contributions for Division 293 = lesser of the excess (0) and contributions ($25,000) = 0. → Division 293 tax = 0 x 0.15 = 0.","{""$0.00"": ""Correct answer"", ""$0.15"": ""Treated income at the threshold as $1 over and charged 15c"", ""$37,500.00"": ""Applied the 15% rate to the entire $250,000 of income"", ""$3,750.00"": ""Charged 15% on all $25,000 of concessional contributions, ignoring that nothing is over the threshold""}","{""formula"": ""max(0, min(div293_income - threshold, concessional)) * div293_rate"", ""params"": {""div293_income"": 250000, ""threshold"": 250000, ""div293_rate"": 0.15, ""concessional"": 25000}, ""expected"": 0.0}","[""ITAA 1997 s 293-15"", ""ITAA 1997 s 293-20"", ""ITAA 1997 Div 293""]",https://www.ato.gov.au/tax-rates-and-codes/key-superannuation-rates-and-thresholds/division-293-tax | |
| Q063,A,"$2,678.58",2678.58,AUD,"Frankable distribution = 12,500; benchmark franking percentage = 50%; actual franking = 0% → Franking percentage differential = 50% - 0% = 50% → Gross-up rate (30% rate) = (100% - 30%) / 30% = 2.33333 → Under-franking debit = 12,500 x 50% / 2.33333 = 2,678.58","{""$2,678.58"": ""Correct answer"", ""$5,357.15"": ""Calculated the maximum franking credit on the whole distribution instead of the 50% under-franked portion"", ""$6,250.00"": ""Multiplied the distribution by the differential but forgot to divide by the gross-up rate"", ""$2,370.66"": ""Used the 27.5% base-rate-entity gross-up rate instead of Re Pty Ltd's 30% rate (2.33333)""}","{""formula"": ""distribution * franking_differential / gross_up_rate"", ""params"": {""distribution"": 12500, ""franking_differential"": 0.5, ""gross_up_rate"": 2.33333}, ""expected"": 2678.58}","[""ITAA 1997 s 203-50"", ""ITAA 1997 s 205-30""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/in-detail/how-to-calculate-over-franking-tax-and-under-franking-debit | |
| Q064,D,"$1,257.02",1257.02,AUD,"Repayment income $62,851 is the first dollar of the 2024-25 2.0% band ($62,851 - $66,620). → For 2024-25 the rate applies to the WHOLE repayment income, not the amount over a threshold. → Repayment = 62,851 x 0.02 = 1,257.02.","{""$168.32"": ""Charged 2% only on the amount over the nil threshold (marginal thinking), which doesn't apply for 2024-25"", ""$628.51"": ""Used the 1.0% rate from the band below instead of the 2.0% band the income falls in"", ""$0.00"": ""Charged 2% only on the excess over the band floor, giving $0"", ""$1,257.02"": ""Correct answer""}","{""formula"": ""repayment_income * rate"", ""params"": {""repayment_income"": 62851, ""rate"": 0.02, ""lower_rate"": 0.01, ""nil_threshold"": 54435}, ""expected"": 1257.02}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q065,C,"$26,312.50",26312.5,AUD,"The $5,000 inheritance is a non-assessable capital receipt and is excluded from income → Taxable income = salary 105,000 + bank interest 1,200 − deduction 2,300 = 103,900 → Income tax (2023-24 bracket $45,001-$120,000) = 5,092 + (103,900 − 45,000) × 0.325 = 5,092 + 19,142.50 = 24,234.50 → Medicare levy = 103,900 × 0.02 = 2,078 → Income tax payable incl Medicare levy = 24,234.50 + 2,078 = 26,312.50","{""$24,234.50"": ""Forgot to add the 2% Medicare levy"", ""$27,106.00"": ""Forgot to subtract the $2,300 of deductible work-related expenses"", ""$26,312.50"": ""Correct answer"", ""$28,037.50"": ""Wrongly included the $5,000 inheritance (a non-assessable capital receipt) in taxable income""}","{""formula"": ""base + ((salary + bank_interest - deduction) - threshold) * marginal_rate + (salary + bank_interest - deduction) * medicare_rate"", ""params"": {""salary"": 105000, ""bank_interest"": 1200, ""deduction"": 2300, ""inheritance"": 5000, ""base"": 5092, ""threshold"": 45000, ""marginal_rate"": 0.325, ""medicare_rate"": 0.02}, ""expected"": 26312.5}","[""ITAA 1997 s 4-10"", ""ITAA 1997 s 6-5"", ""ITAA 1997 s 8-1"", ""Income Tax Rates Act 1986 Sch 7"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/tax-rates-and-codes/tax-rates-australian-residents | |
| Q066,D,"$4,142",4142.0,AUD,"Kept taxable income within the 2021-22 $18,201-$45,000 bracket (19c in the dollar over the tax-free threshold) → The first $18,200 is tax-free (tax-free threshold); only income over $18,200 is taxed at 19c → Tax = (40,000 - 18,200) x 0.19 = 21,800 x 0.19 = 4,142","{""$7,085"": ""Applied the 32.5% rate (the next bracket up) instead of 19%"", ""$4,578"": ""Added a Medicare levy even though the stated figure is income tax only"", ""$7,600"": ""Ignored the tax-free threshold and taxed the whole $40,000 at 19%"", ""$4,142"": ""Correct answer""}","{""formula"": ""(taxable_income - tax_free_threshold) * marginal_rate"", ""params"": {""taxable_income"": 40000, ""tax_free_threshold"": 18200, ""marginal_rate"": 0.19}, ""expected"": 4142.0}","[""ITAA 1997 s 4-10"", ""Income Tax Rates Act 1986 Sch 7""]",https://www.ato.gov.au/forms-and-instructions/low-and-middle-income-earner-tax-offsets | |
| Q067,D,"$15,042.67",15042.67,AUD,"Kept resident_months within the valid 1-12 month range (4 of 12 months) → Flat component = $13,464 → Apportioned component = ($4,736 / 12) x 4 = 394.67 x 4 = 1,578.67 → Tax-free threshold = 13,464 + 1,578.67 = 15,042.67","{""$6,066.67"": ""Apportioned the whole $18,200 threshold instead of only the $4,736 component"", ""$18,200.00"": ""Gave the full $4,736 additional amount instead of apportioning it for 4 months"", ""$1,578.67"": ""Pro-rated only the $4,736 component and dropped the flat $13,464 entirely"", ""$15,042.67"": ""Correct answer""}","{""formula"": ""flat_amount + (apportioned_amount / total_months) * resident_months"", ""params"": {""flat_amount"": 13464, ""apportioned_amount"": 4736, ""resident_months"": 4, ""total_months"": 12}, ""expected"": 15042.67}","[""Income Tax Rates Act 1986 s 20"", ""Income Tax Rates Act 1986 s 16""]",https://www.ato.gov.au/individuals-and-families/coming-to-australia-or-going-overseas/living-overseas-and-becoming-a-foreign-tax-resident | |
| Q068,A,"$5,100",5100.0,AUD,"Deductible (concessional) personal contribution = $6,000 → Super fund pays 15% contributions tax: 6,000 x 0.15 = $900 → Amount credited to the account = 6,000 - 900 = $5,100 (i.e. 6,000 x 0.85)","{""$5,100"": ""Correct answer"", ""$6,000"": ""Forgot the 15% contributions tax the fund pays on concessional contributions"", ""$6,375"": ""Taxed the whole $7,500 contribution rather than only the $6,000 claimed as a deduction"", ""$900"": ""Reported the $900 tax instead of the net amount credited""}","{""formula"": ""contribution * (1 - contrib_tax_rate)"", ""params"": {""contribution"": 6000, ""contrib_tax_rate"": 0.15, ""full_contribution"": 7500}, ""expected"": 5100.0}","[""ITAA 1997 s 290-150"", ""ITAA 1997 s 295-160"", ""ITAA 1997 s 295-190""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/how-to-save-more-in-your-super/personal-super-contributions | |
| Q069,B,"$6,300",6300.0,AUD,"Raw balancing adjustment = adjustable value - termination value = 30,000 - 21,000 = 9,000 (a deduction) → Reduce to the 70% taxable-use proportion: 9,000 x 70% = 6,300 → Greta can claim a $6,300 deduction","{""$2,700"": ""Applied the 30% private-use percentage instead of the 70% taxable-use percentage"", ""$6,300"": ""Correct answer"", ""-$6,300"": ""Reversed the subtraction, turning a deduction into an assessable amount"", ""$9,000"": ""Forgot to reduce the balancing adjustment for the 30% private use""}","{""formula"": ""(adjustable_value - termination_value) * taxable_pct"", ""params"": {""adjustable_value"": 30000, ""termination_value"": 21000, ""taxable_pct"": 0.7, ""private_pct"": 0.3}, ""expected"": 6300.0}","[""ITAA 1997 s 40-285"", ""ITAA 1997 s 40-290""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules-capital-allowances/disposing-or-ceasing-to-use-a-depreciating-asset | |
| Q070,A,$900.00,900.0,AUD,"The equipment is a creditable purchase and BR Holdings holds a tax invoice → GST credit = one eleventh of the GST-inclusive purchase price → GST credit = 9,900 / 11 = 900","{""$900.00"": ""Correct answer"", ""$825.00"": ""Divided the price by the wrong divisor (12) instead of 11"", ""$990.00"": ""Took 10% of the GST-inclusive price instead of 1/11"", ""$81.82"": ""Divided by 11 twice""}","{""formula"": ""purchase_price / 11"", ""params"": {""purchase_price"": 9900}, ""expected"": 900.0}","[""GST Act s 11-20"", ""GST Act s 11-25"", ""GST Act s 29-10""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/claiming-gst-credits/when-you-can-claim-a-gst-credit | |
| Q071,B,$751.25,751.25,AUD,"Walter's rebate income $37,800 is above the $30,994 couple shading-out threshold but below the $43,810 couple cut-out, so it stays within the same shade-out segment as the base example → Walter's actual rebate income above the couple shading-out threshold = 37,800 - 30,994 = 6,806 → Reduction = 6,806 x 0.125 = 850.75 → SAPTO = 1,602 - 850.75 = 751.25","{""-$3,123.00"": ""Reduced by 12.5% of total rebate income instead of only the amount over the shading-out threshold"", ""$751.25"": ""Correct answer"", ""$1,602.00"": ""Ignored the shading-out reduction and claimed the full couple maximum $1,602"", ""$1,379.25"": ""Used the single maximum $2,230 instead of the couple rate $1,602""}","{""formula"": ""max_offset - (rebate_income - shade_threshold) * reduction_rate"", ""params"": {""rebate_income"": 37800, ""max_offset"": 1602, ""shade_threshold"": 30994, ""reduction_rate"": 0.125, ""single_max"": 2230}, ""expected"": 751.25}","[""ITAA 1936 s 160AAAA"", ""Income Tax Assessment (1936 Act) Regulation 2015""]",https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/tax-offsets/seniors-and-pensioners-tax-offset | |
| Q072,A,"$60,000",60000.0,AUD,"Aggregated turnover is under $50m, but the company is a base rate entity only if 80% or less of assessable income is base rate entity passive income → Here 90% of assessable income is passive income, which is more than 80%, so the company is NOT a base rate entity → The full 30% company tax rate applies: $200,000 x 30% = $60,000","{""$60,000"": ""Correct answer"", ""$10,000"": ""Applied only the 5% rate differential instead of the full 30% rate"", ""$55,000"": ""Used the superseded 27.5% base rate entity rate from an earlier income year"", ""$50,000"": ""Applied the 25% base rate entity rate, ignoring that passive income over 80% disqualifies the company""}","{""formula"": ""taxable_income * rate_full"", ""params"": {""taxable_income"": 200000, ""rate_full"": 0.3, ""rate_bre"": 0.25, ""rate_old"": 0.275}, ""expected"": 60000.0}","[""ITRA 1986 s 23"", ""ITAA 1997 s 23AA"", ""ITAA 1997 s 23AB""]",https://www.ato.gov.au/tax-rates-and-codes/company-tax-rate-changes | |
| Q073,B,"$25,000",25000.0,AUD,"Diminishing value formula: base value x (days held / 365) x (200% / effective life) → Rate = 200% / 4 years = 50% → Decline in value = 50,000 x (365 / 365) x 50% = 25,000","{""$18,750"": ""Used the old 150% diminishing value rate (for assets held before 10 May 2006)"", ""$25,000"": ""Correct answer"", ""$6,250"": ""Divided by the effective life twice"", ""$12,500"": ""Used the prime cost 100% rate instead of the diminishing value 200% rate""}","{""formula"": ""base_value * (days_held / days_year) * (dv_factor / effective_life)"", ""params"": {""base_value"": 50000, ""days_held"": 365, ""days_year"": 365, ""effective_life"": 4, ""dv_factor"": 2.0, ""pc_factor"": 1.0}, ""expected"": 25000.0}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-70"", ""ITAA 1997 s 40-72""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules-capital-allowances/prime-cost-straight-line-and-diminishing-value-methods | |
| Q074,A,"$17,302.08",17302.08,AUD,"Tax-free limit = base + (service × years) = 11,985 + (5,994 × 9) = 11,985 + 53,946 = 65,931 → Taxable ETP component = genuine redundancy part − tax-free limit = 120,000 − 65,931 = 54,069 → As it is under the ETP cap and Bianca is below preservation age, tax = 30% + 2% Medicare = 32% → Tax = 54,069 × 0.32 = 17,302.08","{""$17,302.08"": ""Correct answer"", ""$38,400.00"": ""Taxed the whole $120,000 redundancy payment at 32%, ignoring the tax-free limit"", ""$16,220.70"": ""Applied only the 30% ETP rate and forgot the 2% Medicare levy"", ""$32,646.72"": ""Used only one year's service amount instead of multiplying by the 9 completed years""}","{""formula"": ""(genuine_part - (base + service*years)) * (etp_rate + medicare_rate)"", ""params"": {""genuine_part"": 120000, ""base"": 11985, ""service"": 5994, ""years"": 9, ""etp_rate"": 0.3, ""medicare_rate"": 0.02}, ""expected"": 17302.08}","[""ITAA 1997 s 82-10"", ""ITAA 1997 s 83-170"", ""ITAA 1997 s 83-175"", ""Medicare Levy Act 1986 s 6""]",https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/leaving-your-job/how-etp-components-are-taxed | |
| Q075,B,"$12,000",12000.0,AUD,"Capital gain before discount = 24,000 → Priya owned the land for at least 12 months as an Australian resident, so she is entitled to the 50% CGT discount → Apply 50% CGT discount: 24,000 x 0.5 = 12,000","{""$6,000"": ""Applied the 50% discount twice (halved the already-discounted gain)"", ""$12,000"": ""Correct answer"", ""$48,000"": ""Divided by 0.5 instead of multiplying, doubling the gain"", ""$24,000"": ""Forgot to apply the 50% CGT discount and declared the full gain""}","{""formula"": ""gain * discount_rate"", ""params"": {""gain"": 24000, ""discount_rate"": 0.5}, ""expected"": 12000.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 115-25"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q076,B,"$3,750",3750.0,AUD,"Division 293 income = 280,000 + 25,000 = 305,000. → Excess over threshold = 305,000 - 250,000 = 55,000. → Tax base = lesser of the excess (55,000) and the contributions (25,000) = 25,000. → Division 293 tax = 25,000 x 0.15 = 3,750.","{""$4,500"": ""Computed the excess from taxable income only ($30,000), forgetting to add the contributions when comparing to the threshold"", ""$3,750"": ""Correct answer"", ""$8,250"": ""Charged 15% on the full $55,000 excess instead of the lesser-of $25,000 contributions"", ""$7,500"": ""Applied a 30% rate instead of the 15% Division 293 rate""}","{""formula"": ""min((taxable_income + concessional) - threshold, concessional) * div293_rate"", ""params"": {""taxable_income"": 280000, ""concessional"": 25000, ""threshold"": 250000, ""div293_rate"": 0.15}, ""expected"": 3750.0}","[""ITAA 1997 s 293-15"", ""ITAA 1997 s 293-20"", ""ITAA 1997 s 293-25""]",https://www.ato.gov.au/tax-rates-and-codes/key-superannuation-rates-and-thresholds/division-293-tax | |
| Q077,C,$0.00,0.0,AUD,"Notional taxable value of the hamper = $275, which is less than $300 → The benefit is provided once (infrequent and irregular) and it would be unreasonable to treat it as a fringe benefit → The minor benefits exemption (s 58P) applies, so the benefit is exempt and the taxable value is $0","{""$275.00"": ""Used the notional value $275 as the taxable value, missing that the minor benefits exemption makes it $0"", ""$243.87"": ""Treated the exempt minor benefit as taxable and grossed it up at the Type 2 rate then applied 47% FBT"", ""$0.00"": ""Correct answer"", ""$268.87"": ""Treated the exempt benefit as a taxable Type 1 benefit, grossing up at 2.0802 and applying 47% FBT""}","{""formula"": ""0 * notional_value"", ""params"": {""notional_value"": 275, ""gross_up_t1"": 2.0802, ""gross_up_t2"": 1.8868, ""fbt_rate"": 0.47}, ""expected"": 0.0}","[""FBTAA 1986 s 58P"", ""FBTAA 1986 s 136(1)""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/fringe-benefits-tax/exemptions-concessions-and-other-ways-to-reduce-fbt/minor-benefits-exemption | |
| Q078,C,"$79,500",79500.0,AUD,"Carried-forward unused concessional cap entering 2021-22 = $52,000 → Add the standard 2021-22 concessional contributions cap of $27,500 (cap kept fixed from the base example) → Maximum concessional contributions Diego can make = 52,000 + 27,500 = $79,500","{""$41,500"": ""Subtracted the $38,000 Diego actually contributed, which the cap headroom does not deduct"", ""$27,500"": ""Ignored the carried-forward unused cap and used only the annual cap"", ""$79,500"": ""Correct answer"", ""$82,000"": ""Added the 2024-25 cap of $30,000 instead of the 2021-22 cap of $27,500""}","{""formula"": ""accumulated_unused + annual_cap_2122"", ""params"": {""accumulated_unused"": 52000, ""annual_cap_2122"": 27500, ""annual_cap_2425"": 30000, ""contributed_2122"": 38000}, ""expected"": 79500.0}","[""ITAA 1997 s 291-20"", ""ITAA 1997 s 291-25""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/concessional-contributions-cap | |
| Q079,C,$990.00,990.0,AUD,"Apportion the annual rates by the portion of the year rented: 1,650 x (219 / 365) → = 1,650 x 0.6000 = 990","{""$1,650.00"": ""Claimed the full year of council rates without apportioning for the private-use period"", ""$987.30"": ""Divided by 366 instead of 365"", ""$990.00"": ""Correct answer"", ""$660.00"": ""Apportioned using the private-use days (215) instead of the days rented (150)""}","{""formula"": ""council_rates * days_rented / days_in_year"", ""params"": {""council_rates"": 1650, ""days_rented"": 219, ""days_in_year"": 365}, ""expected"": 990.0}","[""ITAA 1997 s 8-1""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q080,C,$475.00,475.0,AUD,"Kept taxable income within the 2021-22 LITO 5c taper band ($37,501-$45,000) → LITO = $700 minus 5 cents for every $1 above $37,500 → Income above the taper start = 42,000 - 37,500 = 4,500 → Reduction = 4,500 x 0.05 = 225 → LITO = 700 - 225 = 475","{""$632.50"": ""Used the 1.5c taper rate (which only applies above $45,000) instead of 5c"", ""$700.00"": ""Gave the full $700 LITO without applying the taper above $37,500"", ""$475.00"": ""Correct answer"", ""-$1,400.00"": ""Applied the 5c taper to the whole taxable income instead of only the amount over $37,500""}","{""formula"": ""max_offset - (taxable_income - taper_start) * taper_rate"", ""params"": {""taxable_income"": 42000, ""max_offset"": 700, ""taper_start"": 37500, ""taper_rate"": 0.05}, ""expected"": 475.0}","[""ITAA 1936 s 159N"", ""ITAA 1997 s 61-570""]",https://www.ato.gov.au/forms-and-instructions/low-and-middle-income-earner-tax-offsets | |
| Q081,C,"$1,500",1500.0,AUD,"Capital loss is applied at its FULL value (losses are never discounted): loss = 9,000 → Subtract the loss from the gain before any discount: 12,000 - 9,000 = 3,000 → Apply the 50% CGT discount to the remaining eligible gain: 3,000 x 0.5 = 1,500","{""$3,750"": ""Trap: wrongly discounted the capital loss by 50% before offsetting it"", ""$3,000"": ""Offset the loss but forgot to apply the 50% discount to the remaining gain"", ""$1,500"": ""Correct answer"", ""-$3,000"": ""Applied the discount to the gain before subtracting the loss (wrong order)""}","{""formula"": ""(share_gain - property_loss) * discount_rate"", ""params"": {""share_gain"": 12000, ""property_loss"": 9000, ""discount_rate"": 0.5}, ""expected"": 1500.0}","[""ITAA 1997 s 102-10"", ""ITAA 1997 s 110-55"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q082,B,"$1,071.43",1071.43,AUD,"Frankable distribution = 12,500; franked to 70%; benchmark = 50% → Franking percentage differential = 70% - 50% = 20% → Gross-up rate (30% rate) = 2.33333 → Over-franking tax = 12,500 x 20% / 2.33333 = 1,071.43","{""$948.26"": ""Used the 27.5% gross-up rate (2.6364) instead of the 30% rate (2.33333)"", ""$1,071.43"": ""Correct answer"", ""$2,500.00"": ""Multiplied the distribution by the 20% differential but forgot to divide by the gross-up rate"", ""$3,750.01"": ""Used the full 70% franking percentage instead of the 20% excess over the 50% benchmark""}","{""formula"": ""distribution * franking_differential / gross_up_rate"", ""params"": {""distribution"": 12500, ""franking_differential"": 0.2, ""gross_up_rate"": 2.33333}, ""expected"": 1071.43}","[""ITAA 1997 s 203-50""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/in-detail/how-to-calculate-over-franking-tax-and-under-franking-debit | |
| Q083,D,"$107,144.39",107144.39,AUD,"Corporate tax rate for imputation purposes = 30% (not a base rate entity) → Applicable gross-up rate = (100% - 30%) / 30% = 2.3333 → Maximum franking credit = 250,000 x (1 / 2.3333) = 107,144.39","{""$94,826.28"": ""Used the 27.5% base-rate-entity gross-up rate (2.6364) instead of the 30% rate (2.3333)"", ""$75,000.00"": ""Multiplied the distribution by the 30% tax rate directly instead of dividing by the gross-up rate"", ""$583,325.00"": ""Multiplied by the gross-up rate instead of by its reciprocal (1 / gross-up rate)"", ""$107,144.39"": ""Correct answer""}","{""formula"": ""distribution * (1 / gross_up_rate)"", ""params"": {""distribution"": 250000, ""gross_up_rate"": 2.3333}, ""expected"": 107144.39}","[""ITAA 1997 s 202-60"", ""ITAA 1997 s 995-1""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/paying-dividends-and-other-distributions/allocating-franking-credits | |
| Q084,B,$0,0.0,AUD,"A private company loan is treated as a deemed dividend only if it is not fully repaid before the company's lodgment day for the year the loan is made → Priya repaid the full $40,000 on 1 April 2025, before the company's lodgment day → Because the loan was fully repaid before lodgment day, there is no deemed dividend: $0","{""$43,508"": ""Treated the loan plus a year of benchmark interest as the deemed dividend"", ""$0"": ""Correct answer"", ""$40,000"": ""Treated the whole $40,000 loan as a deemed dividend, ignoring that it was repaid before lodgment day"", ""$3,508"": ""Calculated notional interest at the benchmark rate as if an interest benefit arose""}","{""formula"": ""0 * loan_amount"", ""params"": {""loan_amount"": 40000, ""benchmark_rate"": 0.0877}, ""expected"": 0.0}","[""ITAA 1936 s 109D"", ""ITAA 1936 s 109N""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/private-company-benefits-division-7a-dividends/in-detail/division-7a-loans | |
| Q085,B,"$109,099",109099.0,AUD,"Tax-free limit = base + (service × years) = 11,985 + (5,994 × 14) = 95,901 → Amount in excess of the tax-free limit = genuine redundancy part − tax-free limit → = 205,000 − 95,901 = 109,099 (this ETP amount is taxed concessionally as it is under the ETP cap)","{""$95,901"": ""Reported the tax-free part itself instead of the amount in excess of it"", ""$109,099"": ""Correct answer"", ""$121,084"": ""Omitted the base amount from the tax-free limit before subtracting"", ""$187,021"": ""Subtracted only one year's service amount instead of 14 years when working out the tax-free limit""}","{""formula"": ""genuine_part - (base + service*years)"", ""params"": {""genuine_part"": 205000, ""base"": 11985, ""service"": 5994, ""years"": 14}, ""expected"": 109099.0}","[""ITAA 1997 s 83-170"", ""ITAA 1997 s 82-10"", ""ITAA 1997 s 83-175""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/engaging-a-worker/when-a-worker-leaves-your-business/taxation-of-termination-payments/redundancy-and-early-retirement | |
| Q086,B,"$7,200",7200.0,AUD,"Rent = 52 weeks x $300 = 15,600 → Room expenses = 16,000 x 25% = 4,000 → General-area expenses = 16,000 x 55% x 50% = 4,400 → Net rental income = 15,600 - 4,000 - 4,400 = 7,200","{""$2,800"": ""Claimed 100% of the general-area expenses instead of John's 50% shared portion"", ""$7,200"": ""Correct answer"", ""$11,600"": ""Claimed only the room's 20% and ignored the shared general-area expenses entirely"", ""$9,200"": ""Applied the 50% shared factor to the room expenses as well as the general areas""}","{""formula"": ""weeks_rented * rent_per_week - (total_expenses * room_fraction + total_expenses * general_fraction * shared_use)"", ""params"": {""weeks_rented"": 52, ""rent_per_week"": 300, ""total_expenses"": 16000, ""room_fraction"": 0.25, ""general_fraction"": 0.55, ""shared_use"": 0.5}, ""expected"": 7200.0}","[""ITAA 1997 s 8-1"", ""IT 2167""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q087,A,"$4,350",4350.0,AUD,"Harriet's repayment income $96,000 is above $67,000 but below $125,000, so it stays within the same 15c marginal band as the base example → Income above the minimum threshold = 96,000 - 67,000 = 29,000 → Compulsory repayment = 29,000 x 15% = 4,350 → (Under the old whole-of-income system it would have been 3.5% x 96,000 = 3,360)","{""$4,350"": ""Correct answer"", ""$3,360"": ""Used the old pre-2025-26 system (3.5% of total repayment income = $3,360)"", ""$14,400"": ""Applied 15% to the whole repayment income instead of only the excess over $67,000"", ""$1,015"": ""Used the marginal base correctly but applied the old 3.5% rate to the excess""}","{""formula"": ""(repayment_income - threshold) * rate"", ""params"": {""repayment_income"": 96000, ""threshold"": 67000, ""rate"": 0.15, ""old_rate"": 0.035}, ""expected"": 4350.0}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/individuals-and-families/study-and-training-support-loans/study-and-training-loans-what-s-new | |
| Q088,D,$95,95.0,AUD,"Total franking credits = 120 + 180 + 240 + 160 (PAYG instalments) + 45 (franked dividend received) = 745 → Total franking debits = 250 (tax refund) + 400 (franked distribution to members) = 650 → Closing balance = 745 - 650 = 95 (account in surplus, so no franking deficit tax)","{""$595"": ""Treated the $250 tax refund as a franking credit instead of a debit"", ""$895"": ""Treated the $400 distribution to members as a franking credit instead of a debit"", ""$50"": ""Omitted the $45 franking credit on the fully franked dividend received"", ""$95"": ""Correct answer""}","{""formula"": ""paygi1 + paygi2 + paygi3 + paygi4 + div_credit - refund_debit - dist_debit"", ""params"": {""paygi1"": 120, ""paygi2"": 180, ""paygi3"": 240, ""paygi4"": 160, ""div_credit"": 45, ""refund_debit"": 250, ""dist_debit"": 400}, ""expected"": 95.0}","[""ITAA 1997 s 205-15"", ""ITAA 1997 s 205-30""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/paying-dividends-and-other-distributions/franking-account | |
| Q089,D,"$68,500",68500.0,AUD,"Cost base = 300,000 + 33,000 + 9,000 + 3,000 + 2,000 + 4,500 = 351,500 → Capital gain ('other' method) = 420,000 - 351,500 = 68,500 → Held less than 12 months, so neither the discount nor the indexation method is available","{""$37,500"": ""Omitted sale costs and also wrongly applied the discount"", ""$75,000"": ""Omitted the $5,500 of sale costs (solicitor + agent) from the cost base"", ""$34,250"": ""Wrongly applied the 50% CGT discount even though the asset was held less than 12 months"", ""$68,500"": ""Correct answer""}","{""formula"": ""proceeds - cost_base"", ""params"": {""proceeds"": 420000, ""cost_base"": 351500, ""cost_base_excl_sale_costs"": 345000, ""discount_rate"": 0.5}, ""expected"": 68500.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 110-25"", ""ITAA 1997 s 115-25""]",https://www.ato.gov.au/forms-and-instructions/capital-gains-tax-guide-2024/about-capital-gains-tax/how-to-work-out-your-capital-gain-or-capital-loss | |
| Q090,D,"$13,675.00",13675.0,AUD,"Apportion the general expenses to the 5 weeks rented: (5 / 52) x 45,500 = 4,375 → Add the fully deductible agent commission and advertising: 4,375 + 1,450 = 5,825 total deductions → Net rental income = rent 19,500 - deductions 5,825 = 13,675","{""-$23,075.00"": ""Apportioned using the 48 private-use weeks instead of the 4 weeks rented"", ""-$27,450.00"": ""Deducted the full year of expenses instead of apportioning to the 4 weeks rented"", ""$14,985.58"": ""Apportioned the agent commission/advertising too, instead of claiming it in full"", ""$13,675.00"": ""Correct answer""}","{""formula"": ""rent_received - ((weeks_rented / weeks_in_year) * apportionable_expenses + agent_costs)"", ""params"": {""rent_received"": 19500, ""apportionable_expenses"": 45500, ""weeks_rented"": 5, ""weeks_in_year"": 52, ""agent_costs"": 1450}, ""expected"": 13675.0}","[""ITAA 1997 s 8-1"", ""IT 2167""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q091,B,"$1,080",1080.0,AUD,"Income for MLS purposes = 85,000 taxable income + 23,000 reportable fringe benefits = 108,000 → Kept income for MLS purposes within the 2025-26 single Tier 1 range ($101,001-$118,000), so the MLS rate is 1% → MLS = 108,000 x 0.01 = 1,080","{""$2,160"": ""Confused the surcharge with the 2% Medicare levy rate"", ""$1,080"": ""Correct answer"", ""$1,350"": ""Used the Tier 2 rate of 1.25% instead of the correct Tier 1 rate of 1%"", ""$850"": ""Calculated the surcharge on taxable income only, ignoring the reportable fringe benefits""}","{""formula"": ""(taxable_income + reportable_fringe_benefits) * tier1_rate"", ""params"": {""taxable_income"": 85000, ""reportable_fringe_benefits"": 23000, ""tier1_rate"": 0.01, ""tier2_rate"": 0.0125, ""medicare_levy_rate"": 0.02}, ""expected"": 1080.0}","[""A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999"", ""Medicare Levy Act 1986 s 8B""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy-surcharge/medicare-levy-surcharge-income-thresholds-and-rates | |
| Q092,D,$383.42,383.42,AUD,"Diminishing value rate = 200% / effective life = 200% / 8 = 25.00% → Apportion for days held: 311 / 365 → Decline in value = 1,800 x (311 / 365) x (2.00 / 8) = 383.42","{""$191.71"": ""Used the prime cost rate (100%/life) instead of the diminishing value rate (200%/life)"", ""$225.00"": ""Halved the full-year diminishing value (confused the part-year with the low-value-pool half-rate) instead of apportioning by days"", ""$450.00"": ""Claimed a full year of decline in value without apportioning for the 346 days held"", ""$383.42"": ""Correct answer""}","{""formula"": ""base_value * (days_held / days_in_year) * (diminishing_rate_pct / effective_life)"", ""params"": {""base_value"": 1800, ""days_held"": 311, ""days_in_year"": 365, ""diminishing_rate_pct"": 2.0, ""effective_life"": 8}, ""expected"": 383.42}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-70"", ""ITAA 1997 s 40-72""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q093,B,"$6,334.00",6334.0,AUD,"The car's price ($84,500) exceeds the 2025-26 car limit of $69,674 → The maximum GST credit is capped at one eleventh of the car limit → Maximum GST credit = 69,674 / 11 = 6,334","{""$7,200.00"": ""Claimed the full $7,200 GST shown on the invoice, ignoring the car limit cap"", ""$6,334.00"": ""Correct answer"", ""$6,967.40"": ""Took 10% of the car limit instead of 1/11"", ""$7,681.82"": ""Claimed 1/11 of the full car price instead of capping at 1/11 of the car limit""}","{""formula"": ""car_limit / 11"", ""params"": {""car_price"": 84500, ""car_limit"": 69674, ""gst_in_price"": 7200}, ""expected"": 6334.0}","[""GST Act s 69-10"", ""ITAA 1997 s 40-230""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/motor-vehicle-and-transport/gst-and-motor-vehicles/purchasing-a-motor-vehicle | |
| Q094,B,$0,0.0,AUD,"MLS is only payable for days WITHOUT appropriate private patient hospital cover. → Priya held appropriate hospital cover for the full 2024-25 year. → Therefore the surcharge is $0, even though her $130,000 income would otherwise be in the Tier 2 (1.25%) band.","{""$1,625"": ""Charged the Tier 2 surcharge (1.25%) on the income, ignoring that full-year hospital cover exempts the surcharge"", ""$0"": ""Correct answer"", ""$1,300"": ""Charged a Tier 1 (1%) surcharge despite the hospital cover and the Tier 2 income level"", ""$2,600"": ""Confused the surcharge with the 2% Medicare levy and charged that instead""}","{""formula"": ""income_for_mls * 0"", ""params"": {""income_for_mls"": 130000, ""tier2_rate"": 0.0125, ""tier1_rate"": 0.01, ""medicare_levy_rate"": 0.02}, ""expected"": 0.0}","[""A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999 s 15"", ""Private Health Insurance Act 2007 s 22-30""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy-surcharge/medicare-levy-surcharge-income-thresholds-and-rates | |
| Q095,D,"$3,136.50",3136.5,AUD,"18.75% of the taxable-use cost of the scanner added this year: 18.75% x 728 = 136.50 → plus 37.5% of the prior-year closing pool balance: 37.5% x 8,000 = 3,000 → Total decline in value = 136.50 + 3,000 = 3,136.50, rounded to 3,137","{""$3,273.00"": ""Used the full 37.5% rate on the newly added asset instead of the half rate (18.75%)"", ""$1,636.50"": ""Applied the half rate (18.75%) to the whole pool including the prior balance"", ""$1,773.00"": ""Swapped the rates - applied 37.5% to the new asset and 18.75% to the prior pool balance"", ""$3,136.50"": ""Correct answer""}","{""formula"": ""new_cost_taxable * add_rate + prior_closing * pool_rate"", ""params"": {""new_cost_taxable"": 728, ""prior_closing"": 8000, ""add_rate"": 0.1875, ""pool_rate"": 0.375}, ""expected"": 3136.5}","[""ITAA 1997 s 40-440"", ""ITAA 1997 s 40-425""]",https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2020/low-value-pools | |
| Q096,A,"$17,800",17800.0,AUD,"Hydraulic attachment is the first second-element (cost addition) to an asset written off earlier and is under the $20,000 limit, so its full $14,000 is immediately deductible → Plasma cutter costs $3,800 (under the limit, 100% business use), so its full cost is immediately deductible → Total deduction = 14,000 + 3,800 = 17,800","{""$17,800"": ""Correct answer"", ""$3,800"": ""Claimed only the cutter and missed the second-element attachment deduction"", ""-$2,200"": ""Wrongly netted off the $20,000 instant asset write-off limit from the total"", ""$14,000"": ""Claimed only the attachment cost addition and missed the separate plasma cutter deduction""}","{""formula"": ""bucket_cost + welder_cost"", ""params"": {""bucket_cost"": 14000, ""welder_cost"": 3800, ""limit"": 20000}, ""expected"": 17800.0}","[""ITAA 1997 s 328-180"", ""ITAA 1997 s 40-190""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/simpler-depreciation-for-small-business/instant-asset-write-off | |
| Q097,C,"$3,587.15",3587.15,AUD,"Annual capital works deduction = 168,400 x 2.5% = 4,210 → Apportion for the 311 days of ownership in the year: 4,210 x (311 / 365) → = 168,400 x 0.025 x (311 / 365) = 3,587 (the denominator is always 365, even in a leap year)","{""$3,577.35"": ""Divided by 366 instead of 365 for the day apportionment"", ""$4,210.00"": ""Claimed the full annual 2.5% without apportioning for the part-year of ownership"", ""$3,587.15"": ""Correct answer"", ""$5,739.44"": ""Used the 4% rate (only for certain short-term traveller accommodation / build-to-rent) instead of 2.5%""}","{""formula"": ""construction_cost * rate * days_rented / days_in_year"", ""params"": {""construction_cost"": 168400, ""rate"": 0.025, ""days_rented"": 311, ""days_in_year"": 365}, ""expected"": 3587.15}","[""ITAA 1997 Div 43"", ""ITAA 1997 s 43-25"", ""ITAA 1997 s 43-210""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q098,C,"$28,000",28000.0,AUD,"Apply the $5,000 loss against the non-discountable gain first: 9,000 − 5,000 = 4,000 (no discount applies as it was held < 12 months) → The discountable property gain is untouched by the loss: 48,000 → Apply the 50% discount to the property gain: 48,000 × 0.5 = 24,000 → Net capital gain = 24,000 + 4,000 = 28,000","{""$33,000"": ""Ignored the $5,000 carried-forward capital loss entirely"", ""$26,000"": ""Wrongly applied the 50% discount to the non-discountable (held < 12 months) gain as well"", ""$28,000"": ""Correct answer"", ""$30,500"": ""Applied the loss against the discountable gain first, halving its value through the discount instead of using it against the non-discountable gain""}","{""formula"": ""(gain_disc) * discount_rate + (gain_nondisc - prior_loss)"", ""params"": {""gain_disc"": 48000, ""gain_nondisc"": 9000, ""prior_loss"": 5000, ""discount_rate"": 0.5}, ""expected"": 28000.0}","[""ITAA 1997 s 102-5"", ""ITAA 1997 s 102-15"", ""ITAA 1997 s 115-100"", ""ITAA 1997 s 115-25""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/using-capital-losses-to-reduce-capital-gains | |
| Q099,A,"$40,000",40000.0,AUD,"For a contract sale, the CGT event happens on the contract date (1 July 2025), not at settlement → Ownership period between the buy contract (5 Aug 2024) and sell contract (1 Jul 2025) is less than 12 months → The 50% CGT discount requires ownership of at least 12 months, so it is NOT available → Capital gain to declare = full gain = 40,000","{""$40,000"": ""Correct answer"", ""$20,000"": ""Trap: applied the 50% CGT discount even though the asset was held less than 12 months"", ""$10,000"": ""Applied the 50% discount and then halved again"", ""$30,000"": ""Applied a 25% discount as if a partial concession applied""}","{""formula"": ""gain"", ""params"": {""gain"": 40000, ""discount_rate"": 0.5}, ""expected"": 40000.0}","[""ITAA 1997 s 115-25"", ""ITAA 1997 s 115-100"", ""ITAA 1997 s 104-10""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/cgt-discount | |
| Q100,C,"$8,000",8000.0,AUD,"GST on taxable sales = $154,000 x 1/11 = $14,000 (GST-free sales carry no GST) → GST credits on purchases = $66,000 x 1/11 = $6,000 → Net GST payable = GST on sales - GST credits = $14,000 - $6,000 = $8,000","{""$10,000"": ""Included GST-free sales in the GST-on-sales calculation, overstating GST collected"", ""$20,000"": ""Added the GST credits to the GST on sales instead of subtracting them"", ""$8,000"": ""Correct answer"", ""$14,000"": ""Reported GST on sales only, forgetting to subtract the GST credits on purchases""}","{""formula"": ""round(taxable_sales * gst_fraction - creditable_purchases * gst_fraction, 2)"", ""params"": {""taxable_sales"": 154000, ""gst_free_sales"": 22000, ""creditable_purchases"": 66000, ""gst_fraction"": 0.09090909090909091}, ""expected"": 8000.0}","[""GST Act 1999 s 7-5"", ""GST Act 1999 s 17-5"", ""GST Act 1999 s 9-70""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/how-gst-works | |
| Q101,D,"$18,250.00",18250.0,AUD,"Taxable value of a board fringe benefit is $2 per meal per person ($1 if under 12), reduced by any employee contribution → Gross taxable value of the board fringe benefits for the year = 18,250 → Employee contribution = 0 → Otherwise deductible reduction = 0 (the meals would not have been deductible to the employees) → Taxable value = 18,250 - 0 - 0 = 18,250","{""$34,434.10"": ""Grossed up the board taxable value by the Type 2 factor instead of reporting the pre-gross-up value"", ""$9,125.00"": ""Wrongly halved the value as if the $1 under-12 child rate applied to everyone"", ""$8,577.50"": ""Reported the FBT payable (47% of the value) instead of the taxable value"", ""$18,250.00"": ""Correct answer""}","{""formula"": ""gross_taxable_value - employee_contribution - reductions"", ""params"": {""gross_taxable_value"": 18250, ""employee_contribution"": 0, ""reductions"": 0}, ""expected"": 18250.0}","[""FBTAA 1986 s 35"", ""FBTAA 1986 s 36"", ""FBTAA 1986 s 37""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q102,D,$0,0.0,AUD,"Taxable value before contribution = $3,000 → Employee contribution = $3,200 → An employee contribution reduces the taxable value, but the taxable value cannot go below zero → Taxable value = max($3,000 - $3,200, 0) = $0","{""-$200"": ""Subtracted the contribution without flooring at zero, producing a negative taxable value of -$200"", ""$6,200"": ""Added the contribution to the taxable value instead of subtracting it"", ""$3,000"": ""Ignored the employee contribution and left the taxable value at $3,000"", ""$0"": ""Correct answer""}","{""formula"": ""max(taxable_value - employee_contribution, 0)"", ""params"": {""taxable_value"": 3000, ""employee_contribution"": 3200}, ""expected"": 0.0}","[""FBTAA 1986 s 9"", ""FBTAA 1986 s 23""]",https://www.ato.gov.au/businesses-and-organisations/hiring-and-paying-your-workers/fringe-benefits-tax/exemptions-concessions-and-other-ways-to-reduce-fbt/reducing-your-fbt-liability | |
| Q103,D,"$1,800",1800.0,AUD,"GST adjustment on cancellation = 1/11 x market value x percentage of business use → = (1/11) x 33,000 x 60% → = 3,000 x 0.60 = 1,800","{""$1,980"": ""Took 10% of the market value instead of 1/11 before applying business use"", ""$3,000"": ""Ignored the 60% business-use proportion and used the full 1/11 of market value"", ""$1,200"": ""Used the 40% private-use proportion instead of the 60% business-use proportion"", ""$1,800"": ""Correct answer""}","{""formula"": ""(1 / 11) * market_value * business_use"", ""params"": {""market_value"": 33000, ""business_use"": 0.6}, ""expected"": 1800.0}","[""GST Act Div 138"", ""GST Act s 138-5""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/rules-for-specific-transactions/business-asset-transactions/gst-and-the-disposal-of-capital-assets | |
| Q104,B,"-$13,650",-13650.0,AUD,"Gross rent = rental income 13,100 + other rental-related income 1,100 = 14,200 → Total expenses = 27,850 → Net rental income or loss = 14,200 - 27,850 = -13,650 (a net rental loss)","{""$42,050"": ""Added rent and expenses instead of subtracting expenses from rent"", ""-$13,650"": ""Correct answer"", ""-$19,350"": ""Forgot to include the $800 of other rental-related income in gross rent"", ""$13,650"": ""Subtracted in the wrong order, reporting the loss as a positive amount""}","{""formula"": ""gross_rent - total_expenses"", ""params"": {""gross_rent"": 14200, ""total_expenses"": 27850}, ""expected"": -13650.0}","[""ITAA 1997 s 8-1"", ""ITAA 1997 s 6-5""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/worksheet-work-out-your-net-rental-income-or-loss | |
| Q105,A,"$390,000",390000.0,AUD,"Annual non-concessional cap in the first (trigger) year = $130,000 (cap kept fixed from the base example) → The bring-forward arrangement allows 3 times the first-year annual cap → Bring-forward cap = 130,000 x 3 = $390,000 (indexation in years 2 and 3 does not change this)","{""$390,000"": ""Correct answer"", ""$260,000"": ""Brought forward only 1 extra year (2x cap) instead of 2 extra years (3x cap)"", ""$410,000"": ""Wrongly indexed years 2 and 3 to $140,000, giving $410,000 (the cap is locked to the first-year amount)"", ""$130,000"": ""Used the single annual cap without applying the bring-forward arrangement""}","{""formula"": ""annual_cap * 3"", ""params"": {""annual_cap"": 130000, ""indexed_cap"": 140000}, ""expected"": 390000.0}","[""ITAA 1997 s 292-85"", ""ITAA 1997 s 292-85(3)""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/non-concessional-contributions-cap | |
| Q106,B,"$5,600",5600.0,AUD,"Operating cost method: taxable value = total operating costs x private use % - employee contribution → Equivalently = total operating costs x (1 - business use %) - employee contribution → = 14,000 x 40% - 0 = 5,600","{""$8,400"": ""Applied the 60% business use percentage instead of the 40% private use percentage"", ""$5,600"": ""Correct answer"", ""$2,800"": ""Wrongly halved the taxable value as if a 50% discount applied"", ""$14,000"": ""Used the full operating costs without applying the private use percentage""}","{""formula"": ""operating_costs * private_use_percent"", ""params"": {""operating_costs"": 14000, ""private_use_percent"": 0.4, ""business_use_percent"": 0.6, ""employee_contribution"": 0}, ""expected"": 5600.0}","[""FBTAA 1986 s 10"", ""FBTAA 1986 s 10(2)""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2017-completing-your-return/fringe-benefit-categories/b-cars-using-the-operating-cost-method | |
| Q107,D,$500,500.0,AUD,"Concessional (before-tax) contributions = $3,600 → LISTO = 15% x 3,600 = $540 → Capped at the $500 maximum (same cap as the base example), so Nadia receives $500","{""$360"": ""Used a 10% rate instead of the 15% LISTO rate"", ""$270"": ""Halved the offset as if the rate were 7.5%"", ""$540"": ""Applied 15% without capping at the $500 maximum"", ""$500"": ""Correct answer""}","{""formula"": ""min(concessional * listo_rate, max_listo)"", ""params"": {""concessional"": 3600, ""listo_rate"": 0.15, ""max_listo"": 500}, ""expected"": 500.0}","[""Superannuation (Government Co-contribution for Low Income Earners) Act 2003 s 12B"", ""Superannuation (Government Co-contribution for Low Income Earners) Act 2003 s 12C""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/how-to-save-more-in-your-super/government-super-contributions/low-income-super-tax-offset | |
| Q108,A,"$120,000.00",120000.0,AUD,"Partial exemption formula: total capital gain x (non-main-residence days / total ownership days) → Taxable portion = 150,000 x (5,840 / 7,300) → = 150,000 x 0.80000 = 120,000","{""$120,000.00"": ""Correct answer"", ""$30,000.00"": ""Used main-residence days in the numerator instead of non-main-residence days"", ""$149,999.20"": ""Subtracted the day ratio from the gain instead of multiplying"", ""$60,000.00"": ""Wrongly applied a 50% CGT discount to the apportioned gain in this example""}","{""formula"": ""total_gain * non_main_days / total_days"", ""params"": {""total_gain"": 150000, ""non_main_days"": 5840, ""total_days"": 7300}, ""expected"": 120000.0}","[""ITAA 1997 s 118-185"", ""ITAA 1997 s 104-10""]",https://www.ato.gov.au/forms-and-instructions/capital-gains-tax-guide-2014/part-a-about-capital-gains-tax/real-estate-and-main-residence/partial-exemption | |
| Q109,A,"$5,591",5591.0,AUD,"Closing pool balance for 2018-19 = 8,000 → plus taxable-use cost of the scanner added in 2019-20 = 728 → less decline in value of the pool for 2019-20 = 3,137 → Closing balance = 8,000 + 728 - 3,137 = 5,591","{""$5,591"": ""Correct answer"", ""$8,728"": ""Forgot to subtract the year's decline in value"", ""$4,863"": ""Forgot to add the cost of the scanner allocated during the year"", ""$4,135"": ""Subtracted the new asset cost instead of adding it""}","{""formula"": ""prior_closing + new_cost_taxable - decline"", ""params"": {""prior_closing"": 8000, ""new_cost_taxable"": 728, ""decline"": 3137, ""pool_rate"": 0.375}, ""expected"": 5591.0}","[""ITAA 1997 s 40-445"", ""ITAA 1997 s 40-440""]",https://www.ato.gov.au/forms-and-instructions/depreciating-assets-guide-2020/low-value-pools | |
| Q110,A,"$91,000",91000.0,AUD,"Repayment income = taxable income + reportable fringe benefits + total net investment loss + reportable super contributions + exempt foreign employment income → = 61,300 + 6,200 + 2,400 + 18,000 + 3,100 → = 91,000","{""$91,000"": ""Correct answer"", ""$61,300"": ""Used taxable income alone as the repayment income"", ""$84,800"": ""Omitted reportable fringe benefits from the repayment income build-up"", ""$88,600"": ""Omitted the total net investment loss from the build-up""}","{""formula"": ""taxable_income + reportable_fringe_benefits + total_net_investment_loss + reportable_super + exempt_foreign_income"", ""params"": {""taxable_income"": 61300, ""reportable_fringe_benefits"": 6200, ""total_net_investment_loss"": 2400, ""reportable_super"": 18000, ""exempt_foreign_income"": 3100}, ""expected"": 91000.0}","[""Higher Education Support Act 2003 s 154-5"", ""ITAA 1997 s 995-1 (repayment income)""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q111,C,$28,28.0,AUD,"Goods similar (but not identical) to those sold in the ordinary course of business: taxable value = 75% of the notional (market) value, reduced by any employee contribution → Notional value of the damaged racquet = 48 → 75% x 48 = 36.00 → Reduce by the employee contribution: 36.00 - 8 = 28.00","{""$40"": ""Forgot to apply the 75% rule to the notional value"", ""$36"": ""Forgot to deduct the $8 employee contribution"", ""$28"": ""Correct answer"", ""$52"": ""Used the $80 normal arm's length price instead of the $48 notional value of the damaged goods""}","{""formula"": ""notional_value * in_house_rate - employee_contribution"", ""params"": {""notional_value"": 48, ""arms_length_price"": 80, ""in_house_rate"": 0.75, ""employee_contribution"": 8}, ""expected"": 28.0}","[""FBTAA 1986 s 42""]",https://www.ato.gov.au/law/view/document?DocID=SAV/FBTGEMP/00018&PiT=99991231235958 | |
| Q112,D,"$7,000",7000.0,AUD,"Subtract capital losses from capital gains BEFORE the discount: 8,000 - 15,000 = -7,000 → The result is below zero, so there is no net capital gain and the 50% discount is never applied → The $7,000 net capital loss is carried forward to future income years","{""$15,000"": ""Carried forward the gross property loss and ignored the offsetting share gain"", ""$11,000"": ""Trap: discounted the $8,000 gain by 50% before offsetting, inflating the carried-forward loss to 11,000"", ""$3,500"": ""Applied the 50% discount to the net capital loss (losses are never discounted)"", ""$7,000"": ""Correct answer""}","{""formula"": ""property_loss - share_gain"", ""params"": {""share_gain"": 8000, ""property_loss"": 15000, ""discount_rate"": 0.5}, ""expected"": 7000.0}","[""ITAA 1997 s 102-10"", ""ITAA 1997 s 102-15"", ""ITAA 1997 s 102-5""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q113,C,"$2,533.60",2533.6,AUD,"Maximum GST credit (100% business use) = 69,674 / 11 = 6,334 → Nadia uses the car 40% for business, so she claims only the business-use proportion → GST credit = 6,334 x 40% = 2,534","{""$6,334.00"": ""Claimed the full $6,334 without apportioning for 40% business use"", ""$2,786.96"": ""Took 10% of the car limit instead of 1/11 before applying the 40% business use"", ""$2,533.60"": ""Correct answer"", ""$230.33"": ""Divided by 11 twice when applying the cap and the credit""}","{""formula"": ""car_limit / 11 * business_use"", ""params"": {""car_limit"": 69674, ""business_use"": 0.4}, ""expected"": 2533.6}","[""GST Act s 11-30"", ""GST Act s 69-10""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/motor-vehicle-and-transport/gst-and-motor-vehicles/purchasing-a-motor-vehicle | |
| Q114,B,"$1,140.00",1140.0,AUD,"Ordinary time earnings for the quarter = $9,500 → Super guarantee rate for 2025-26 = 12% (rate kept fixed from the base example) → SG = 9,500 x 12% = $1,140","{""$9,500.00"": ""Forgot to apply the SG rate to ordinary time earnings"", ""$1,140.00"": ""Correct answer"", ""$1,045.00"": ""Used the 2023-24 SG rate of 11% instead of 12%"", ""$1,092.50"": ""Used the 2024-25 SG rate of 11.5% instead of 12%""}","{""formula"": ""ote * sg_rate"", ""params"": {""ote"": 9500, ""sg_rate"": 0.12, ""old_rate"": 0.115}, ""expected"": 1140.0}","[""Superannuation Guarantee (Administration) Act 1992 s 19"", ""Superannuation Guarantee (Administration) Act 1992 s 23""]",https://www.ato.gov.au/businesses-and-organisations/super-for-employers/super-guarantee-employer-obligations-online-course/module-4-calculating-super-guarantee | |
| Q115,C,"$6,000",6000.0,AUD,"Fourth-quarter instalment = 100% of estimated tax − amounts paid in Q1, Q2 and Q3 → = $24,000 − ($8,000 + $8,000 + $2,000) → = $24,000 − $18,000 = $6,000","{""$8,000"": ""Forgot to subtract the third-quarter instalment of $2,000"", ""$0"": ""Applied the 75% third-quarter proportion instead of 100% in the final quarter"", ""$6,000"": ""Correct answer"", ""$18,000"": ""Added up the instalments already paid instead of working out the remaining balance""}","{""formula"": ""est_tax - (q1 + q2 + q3)"", ""params"": {""est_tax"": 24000, ""q1"": 8000, ""q2"": 8000, ""q3"": 2000}, ""expected"": 6000.0}","[""TAA 1953 Sch 1 s 45-110"", ""TAA 1953 Sch 1 s 45-205""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/payg-instalments/how-to-vary-your-payg-instalments | |
| Q116,B,"$4,888.47",4888.47,AUD,"Type 1 benefits (GST credit available) are grossed up at 2.0802 → Grossed-up taxable value = $5,000 x 2.0802 = $10,401.00 → FBT payable = grossed-up value x 47% = $10,401.00 x 0.47 = $4,888.47","{""$2,350.00"": ""Applied 47% FBT to the taxable value without grossing it up first"", ""$4,888.47"": ""Correct answer"", ""$10,401.00"": ""Reported the grossed-up taxable value as the FBT payable, forgetting to apply the 47% rate"", ""$4,433.98"": ""Used the Type 2 gross-up rate (1.8868) although GST credits were available, understating FBT""}","{""formula"": ""round(taxable_value * gross_up_t1 * fbt_rate, 2)"", ""params"": {""taxable_value"": 5000, ""gross_up_t1"": 2.0802, ""gross_up_t2"": 1.8868, ""fbt_rate"": 0.47}, ""expected"": 4888.47}","[""FBTAA 1986 s 5B"", ""FBTAA 1986 s 136(1)""]",https://www.ato.gov.au/tax-rates-and-codes/fringe-benefits-tax-rates-and-thresholds | |
| Q117,C,$900,900.0,AUD,"Combined Division 293 income and contributions = 244,000 + 12,000 = 256,000, which is above the $250,000 threshold (same side as the base example) → Amount above the $250,000 threshold = 256,000 - 250,000 = 6,000 → Taxable contributions = lesser of contributions ($12,000) and the excess ($6,000) = 6,000 (the excess is the lesser, as in the base example) → Division 293 tax = 6,000 x 15% = 900","{""$38,400"": ""Applied 15% to the full combined total of $256,000"", ""$1,800"": ""Taxed all $12,000 of super contributions instead of the lesser amount"", ""$900"": ""Correct answer"", ""$36,600"": ""Applied 15% to the Division 293 income figure""}","{""formula"": ""min(contributions, (div293_income + contributions) - threshold) * rate"", ""params"": {""div293_income"": 244000, ""contributions"": 12000, ""threshold"": 250000, ""rate"": 0.15}, ""expected"": 900.0}","[""ITAA 1997 Division 293"", ""Taxation (Division 293 Tax) (Imposition) Act 2012""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/division-293-tax-on-concessional-contributions-by-high-income-earners | |
| Q118,C,$280,280.0,AUD,"Deductible accommodation = 2,200 x (1 day / 11 days) = 200 → Add the deductible commercial-property taxi fare of 80 → Total deductible travel = 80 + 200 = 280 (airfares and the residential-property taxi are not deductible)","{""$380"": ""Also claimed the $100 residential-property taxi fare, which is not deductible"", ""$480"": ""Counted both the commercial and residential property days (2/10) for the accommodation, but the residential rental travel is not deductible"", ""$280"": ""Correct answer"", ""$3,380"": ""Claimed the full accommodation plus the non-deductible airfares and residential taxi""}","{""formula"": ""commercial_taxi + accommodation * commercial_days / total_days"", ""params"": {""commercial_taxi"": 80, ""accommodation"": 2200, ""commercial_days"": 1, ""total_days"": 11}, ""expected"": 280.0}","[""ITAA 1997 s 8-1"", ""ITAA 1997 s 26-31"", ""LCR 2018/7""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q119,B,"$3,876",3876.0,AUD,"Marcus's repayment income $92,840 is above $67,000 but below $125,000, so it stays within the same 15c-in-the-dollar marginal band as the base example → Income above the threshold = 92,840 - 67,000 = 25,840 → Compulsory repayment = 25,840 x 15% = 3,876.00","{""$25,840"": ""Reported the income above the threshold without multiplying by the 15% rate"", ""$3,876"": ""Correct answer"", ""$13,926"": ""Applied the 15% rate to the whole repayment income instead of only the amount over $67,000"", ""$2,584"": ""Used the wrong band rate (10% top-band rate) instead of 15%""}","{""formula"": ""(repayment_income - threshold) * rate"", ""params"": {""repayment_income"": 92840, ""threshold"": 67000, ""rate"": 0.15}, ""expected"": 3876.0}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q120,D,"$4,100.00",4100.0,AUD,"Daniel made a creditable purchase and holds a tax invoice → The GST credit equals the GST included in the price = one eleventh of the GST-inclusive amount paid → GST credit = 45,100 / 11 = 4,100","{""$3,758.33"": ""Divided the price by the wrong divisor (12) instead of 11"", ""$4,510.00"": ""Took 10% of the GST-inclusive price instead of 1/11"", ""$372.73"": ""Divided the price by 11 twice"", ""$4,100.00"": ""Correct answer""}","{""formula"": ""amount_paid / 11"", ""params"": {""amount_paid"": 45100}, ""expected"": 4100.0}","[""GST Act s 11-20"", ""GST Act s 11-25""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/motor-vehicle-and-transport/motor-vehicle-incentive-payments/examples-working-out-the-gst | |
| Q121,C,"$94,826.28",94826.28,AUD,"Corporate tax rate for imputation purposes = 27.5% (base rate entity) → Applicable gross-up rate = (100% - 27.5%) / 27.5% = 2.6364 → Maximum franking credit = 250,000 x (1 / 2.6364) = 94,826.28","{""$107,144.39"": ""Used the 30% gross-up rate (2.3333) instead of the base-rate-entity 27.5% rate (2.6364)"", ""$68,750.00"": ""Multiplied the distribution by the 27.5% tax rate directly instead of dividing by the gross-up rate"", ""$94,826.28"": ""Correct answer"", ""$659,100.00"": ""Multiplied by the gross-up rate instead of by its reciprocal (1 / gross-up rate)""}","{""formula"": ""distribution * (1 / gross_up_rate)"", ""params"": {""distribution"": 250000, ""gross_up_rate"": 2.6364}, ""expected"": 94826.28}","[""ITAA 1997 s 202-60"", ""ITAA 1997 s 995-1""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/paying-dividends-and-other-distributions/allocating-franking-credits | |
| Q122,A,"$6,000",6000.0,AUD,"Total capital gain = 41,000 - 26,000 = 15,000 → Deduct the prior-year net capital loss BEFORE the discount: 15,000 - 3,000 = 12,000 → Apply 50% CGT discount: 12,000 x 0.5 = 6,000","{""$6,000"": ""Correct answer"", ""$12,000"": ""Deducted the loss but forgot to apply the 50% discount"", ""$4,500"": ""Applied the discount before deducting the prior-year loss"", ""$7,500"": ""Ignored the carried-forward capital loss""}","{""formula"": ""(proceeds - cost_base - prior_loss) * discount_rate"", ""params"": {""proceeds"": 41000, ""cost_base"": 26000, ""prior_loss"": 3000, ""discount_rate"": 0.5}, ""expected"": 6000.0}","[""ITAA 1997 s 102-5"", ""ITAA 1997 s 102-15"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/forms-and-instructions/capital-gains-tax-personal-investors-guide-2013/part-b-sale-of-shares-or-units/b2-worked-examples-for-shares-and-units | |
| Q123,B,"$1,050",1050.0,AUD,"Combined income and contributions = 246,000 + 11,000 = $257,000, above the $250,000 threshold (same side as the base example) → Amount over the $250,000 threshold = 257,000 - 250,000 = $7,000 → Taxable contributions = lesser of contributions ($11,000) and the excess ($7,000) = $7,000 (the excess is the lesser, as in the base example) → Division 293 tax = 15% x 7,000 = $1,050","{""$7,000"": ""Reported the $7,000 excess itself as the tax instead of 15% of it"", ""$1,050"": ""Correct answer"", ""$1,650"": ""Applied 15% to all $11,000 of contributions, ignoring the lesser-of-the-excess rule"", ""$38,550"": ""Applied 15% to the whole combined $257,000, forgetting to subtract the $250,000 threshold""}","{""formula"": ""rate * min(d293_contributions, (d293_income + d293_contributions) - threshold)"", ""params"": {""d293_income"": 246000, ""d293_contributions"": 11000, ""threshold"": 250000, ""rate"": 0.15}, ""expected"": 1050.0}","[""ITAA 1997 Div 293"", ""ITAA 1997 s 293-15"", ""ITAA 1997 s 293-20""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/division-293-tax-on-concessional-contributions-by-high-income-earners | |
| Q124,B,"$1,700",1700.0,AUD,"In-house property fringe benefit (not salary packaged): taxable value = 75% of the lowest public selling price → Gross taxable value = (2,400 + 1,800) x 75% = 3,150 → Reduce by the employee contribution: 3,150 - 450 → Reduce by the in-house benefits concession of up to $1,000 per employee per year: - 1,000 → Taxable value = 3,150 - 450 - 1,000 = 1,700","{""$2,150"": ""Forgot to deduct the $450 employee contribution"", ""$1,700"": ""Correct answer"", ""$2,750"": ""Used the full selling price instead of 75% of it"", ""$2,700"": ""Forgot to apply the $1,000 in-house benefits concession""}","{""formula"": ""(tv_price + aircon_price) * in_house_rate - employee_contribution - concession"", ""params"": {""tv_price"": 2400, ""aircon_price"": 1800, ""in_house_rate"": 0.75, ""employee_contribution"": 450, ""concession"": 1000}, ""expected"": 1700.0}","[""FBTAA 1986 s 42"", ""FBTAA 1986 s 62""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q125,D,$636,636.0,AUD,"Step 1 - Taxable value ignoring the otherwise deductible rule = (80,000 x 5.65%) - (80,000 x 3%) = 4,520 - 2,400 = 2,120 → Step 2 - Notional interest if the loan were interest-free = 80,000 x 5.65% = 4,520 → Step 3 - Hypothetical deductible amount = 4,520 x 70% business use = 3,164 → Step 4 - Actual deductible amount on interest charged = 2,400 x 70% = 1,680 → Step 5 - Reduction = 3,164 - 1,680 = 1,484 → Step 6 - Taxable value = 2,120 - 1,484 = 636","{""-$1,044"": ""Subtracted only the hypothetical deductible amount and forgot to add back the actual deductible amount"", ""$1,484"": ""Wrongly applied the 70% business percentage directly to the Step 1 taxable value"", ""$2,120"": ""Stopped at Step 1 and ignored the otherwise deductible reduction"", ""$636"": ""Correct answer""}","{""formula"": ""(loan * statutory_rate - loan * actual_rate) - ((loan * statutory_rate) * business_pct - (loan * actual_rate) * business_pct)"", ""params"": {""loan"": 80000, ""statutory_rate"": 0.0565, ""actual_rate"": 0.03, ""business_pct"": 0.7}, ""expected"": 636.0}","[""FBTAA 1986 s 16"", ""FBTAA 1986 s 18"", ""FBTAA 1986 s 19""]",https://www.ato.gov.au/law/view/document?DocID=SAV/FBTGEMP/00009&PiT=99991231235958 | |
| Q126,A,"$3,120",3120.0,AUD,"Pre-existing commitment exists, so the transitional statutory percentage applies: 25,000 to 40,000 km travelled = 11% → Car available for the whole FBT year, so no days apportionment is needed → Taxable value = (base value x statutory rate) - employee contribution = (42,000 x 0.11) - 1,500 → = 4,620 - 1,500 = 3,120","{""$3,120"": ""Correct answer"", ""$6,900"": ""Used the flat 20% rate instead of the 11% pre-existing-commitment transitional rate"", ""$6,120"": ""Added the employee contribution instead of subtracting it"", ""$4,620"": ""Forgot to subtract the $1,500 employee (fuel) contribution""}","{""formula"": ""base_value * statutory_rate - employee_contribution"", ""params"": {""base_value"": 42000, ""statutory_rate"": 0.11, ""employee_contribution"": 1500}, ""expected"": 3120.0}","[""FBTAA 1986 s 9"", ""FBTAA 1986 s 9(2)""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2017-completing-your-return/fringe-benefit-categories/a-cars-using-the-statutory-formula | |
| Q127,A,$0,0.0,AUD,"The dishwasher is used 0% for a taxable purpose (100% private holiday use) → Decline in value must be reduced for private use; with 0% taxable use the deductible amount is nil → Full-year diminishing value would be 4,000 x (2.0/10) = 800, but x 0% taxable use = 0 → Deduction = 0","{""$0"": ""Correct answer"", ""$4,000"": ""Claimed the whole $4,000 cost as an immediate deduction (asset is over $300 and wholly private)"", ""$800"": ""Trap: claimed the full diminishing value deduction (800) ignoring that the asset is used 100% privately"", ""$400"": ""Claimed a prime-cost deduction (400) ignoring the 100% private use""}","{""formula"": ""cost * (dv_factor / effective_life) * taxable_pct"", ""params"": {""cost"": 4000, ""taxable_pct"": 0.0, ""effective_life"": 10, ""dv_factor"": 2.0}, ""expected"": 0.0}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-25(2)""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/property-and-land/residential-rental-properties/rental-expenses/depreciating-assets-in-rental-properties | |
| Q128,D,"$3,000",3000.0,AUD,"The instant asset write-off requires the asset's full cost to be LESS THAN $20,000 → The cost is exactly $20,000, which is not below the limit, so the immediate write-off is NOT available → The asset is allocated to the small business pool and deducted at 15% in the first year: 20,000 x 15% = 3,000","{""$20,000"": ""Trap: claimed the full $20,000 under the instant asset write-off, but at exactly the limit the cost is not 'less than' the limit so it does not qualify"", ""$1,500"": ""Halved the first-year pool deduction again"", ""$6,000"": ""Used the 30% ongoing pool rate instead of the 15% first-year (half-rate) pool rate"", ""$3,000"": ""Correct answer""}","{""formula"": ""cost * first_year_pool_rate"", ""params"": {""cost"": 20000, ""limit"": 20000, ""first_year_pool_rate"": 0.15, ""ongoing_pool_rate"": 0.3}, ""expected"": 3000.0}","[""ITAA 1997 s 328-180"", ""IT(TP)A 1997 s 328-180"", ""ITAA 1997 s 328-185""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/simpler-depreciation-for-small-business/instant-asset-write-off | |
| Q129,C,"$13,038.40",13038.4,AUD,"Repayment income = 134,200 + 16,320 = 150,520, which stays within the same $125,001-$179,285 band as the base example → Income above $125,000 = 150,520 - 125,000 = 25,520 → 17c component = 25,520 x 17% = 4,338.40 → Compulsory repayment = 8,700 + 4,338.40 = 13,038.40","{""$15,052.00"": ""Applied the 10% top-band rate to the whole repayment income"", ""$4,338.40"": ""Forgot to add the $8,700 base amount for the band"", ""$13,038.40"": ""Correct answer"", ""$34,288.40"": ""Applied 17% to the whole repayment income before adding the base, instead of only to the excess over $125,000""}","{""formula"": ""base + (repayment_income - threshold) * rate"", ""params"": {""repayment_income"": 150520, ""threshold"": 125000, ""base"": 8700, ""rate"": 0.17}, ""expected"": 13038.4}","[""Higher Education Support Act 2003 s 154-1"", ""Higher Education Support Act 2003 s 154-20""]",https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds | |
| Q130,A,"$1,550",1550.0,AUD,"Kept taxable income within the overlapping 2021-22 LITO 5c taper band and LMITO 7.5c phase-in band ($37,501-$45,000) → LITO = 700 - (43,000 - 37,500) x 0.05 = 700 - 275 = 425 → LMITO = 675 + (43,000 - 37,000) x 0.075 = 675 + 450 = 1,125 → Total offset = 425 + 1,125 = 1,550","{""$1,550"": ""Correct answer"", ""$1,125"": ""Counted only the LMITO and omitted the LITO"", ""$1,100"": ""Used the LMITO base of $675 without adding the 7.5c-per-dollar phase-in amount"", ""$425"": ""Counted only the LITO and omitted the LMITO""}","{""formula"": ""(lito_max - (taxable_income - lito_taper_start) * lito_taper_rate) + (lmito_base + (taxable_income - lmito_phase_start) * lmito_phase_rate)"", ""params"": {""taxable_income"": 43000, ""lito_max"": 700, ""lito_taper_start"": 37500, ""lito_taper_rate"": 0.05, ""lmito_base"": 675, ""lmito_phase_start"": 37000, ""lmito_phase_rate"": 0.075}, ""expected"": 1550.0}","[""ITAA 1936 s 159N"", ""ITAA 1997 s 61-570"", ""ITAA 1997 s 61-575""]",https://www.ato.gov.au/forms-and-instructions/low-and-middle-income-earner-tax-offsets | |
| Q131,A,"$34,125",34125.0,AUD,"Foreign residents get NO tax-free threshold: the first dollar is taxed. → 2024-25 foreign resident first bracket: 32.5c for each $1 from 0 to $120,000. → Income tax = 105,000 x 0.325 = 34,125. → Foreign residents are not required to pay the Medicare levy, so nothing is added.","{""$34,125"": ""Correct answer"", ""$28,210"": ""Applied the $18,200 tax-free threshold before the foreign resident rate (foreign residents don't get it)"", ""$24,592"": ""Used the resident schedule ($5,092 base + 32.5c over $45,000), wrongly giving the foreign resident the tax-free threshold/base step"", ""$36,225"": ""Added a 2% Medicare levy even though foreign residents are exempt from the Medicare levy""}","{""formula"": ""taxable_income * foreign_rate"", ""params"": {""taxable_income"": 105000, ""foreign_rate"": 0.325, ""tax_free_threshold"": 18200, ""resident_base"": 5092, ""resident_threshold"": 45000, ""resident_rate"": 0.325, ""medicare_rate"": 0.02}, ""expected"": 34125.0}","[""Income Tax Rates Act 1986 s 12"", ""Income Tax Rates Act 1986 Sch 7 Pt II"", ""Medicare Levy Act 1986 s 7""]",https://www.ato.gov.au/tax-rates-and-codes/tax-rates-foreign-residents | |
| Q132,B,"$2,000",2000.0,AUD,"Estimated tax for the year = $24,000 → Cumulative amount required by the third quarter = 75% × $24,000 = $18,000 → Less amounts already paid in Q1 and Q2: $18,000 − ($8,000 + $8,000) = $2,000","{""-$4,000"": ""Applied the second-quarter 50% proportion instead of the third-quarter 75%"", ""$2,000"": ""Correct answer"", ""$8,000"": ""Used 100% of the estimated tax instead of the 75% cumulative third-quarter proportion"", ""$18,000"": ""Forgot to subtract the first and second quarter instalments already paid""}","{""formula"": ""est_tax*q3_pct - (q1 + q2)"", ""params"": {""est_tax"": 24000, ""q3_pct"": 0.75, ""q1"": 8000, ""q2"": 8000}, ""expected"": 2000.0}","[""TAA 1953 Sch 1 s 45-110"", ""TAA 1953 Sch 1 s 45-205""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/payg-instalments/how-to-vary-your-payg-instalments | |
| Q133,A,"$1,344.88",1344.88,AUD,"Dimitri's rebate income $42,000 is above the $34,919 shading-out threshold but below the $52,759 cut-out, so it stays within the same shade-out segment as the base example → Rebate income above the shading-out threshold = 42,000 - 34,919 = 7,081 → Reduction = 7,081 x 0.125 = 885.125 → SAPTO = 2,230 - 885.125 = 1,344.875, which the ATO rounds up to 1,345","{""$1,344.88"": ""Correct answer"", ""$2,230.00"": ""Ignored the shading-out reduction and claimed the full maximum $2,230"", ""-$3,020.00"": ""Reduced by 12.5% of total rebate income instead of only the amount over the shading-out threshold"", ""$885.12"": ""Reported the reduction amount instead of the remaining offset""}","{""formula"": ""max_offset - (rebate_income - shade_threshold) * reduction_rate"", ""params"": {""rebate_income"": 42000, ""max_offset"": 2230, ""shade_threshold"": 34919, ""reduction_rate"": 0.125}, ""expected"": 1344.88}","[""ITAA 1936 s 160AAAA"", ""Income Tax Assessment (1936 Act) Regulation 2015""]",https://www.ato.gov.au/individuals-and-families/income-deductions-offsets-and-records/tax-offsets/seniors-and-pensioners-tax-offset | |
| Q134,B,$325.76,325.76,AUD,"Spread over 5 years (1,826 days) and apportion for the 332 days in the first year: 2,150 x (332 / 1,826) = 390.91 → Apportion for the rental-property portion of the loan: 390.91 x (220,000 / 264,000) → = 325.76","{""$390.91"": ""Forgot to exclude the private car portion of the loan ($39,000)"", ""$325.76"": ""Correct answer"", ""$358.33"": ""Used a flat one-fifth of the expenses instead of apportioning the first year by days"", ""$1,791.67"": ""Claimed the whole rental-portion of borrowing expenses in year 1 instead of spreading over 5 years""}","{""formula"": ""borrowing_expenses * (days_first_year / days_5yr) * (rental_loan / total_loan)"", ""params"": {""borrowing_expenses"": 2150, ""days_first_year"": 332, ""days_5yr"": 1826, ""rental_loan"": 220000, ""total_loan"": 264000}, ""expected"": 325.76}","[""ITAA 1997 s 25-25""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q135,A,$750,750.0,AUD,"Decreasing adjustment = 1/11 x price x (1 - adjusted GST credit / full GST credit) → = (1/11) x 27,500 x (1 - 3,500/5,000) → = 2,500 x (1 - 0.7) = 2,500 x 0.3 = 750","{""$750"": ""Correct answer"", ""$1,750"": ""Multiplied by the 70% credit ratio instead of the 30% private-use factor (1 - ratio)"", ""$1,500"": ""Took the difference between full and claimed credits ($1,500) instead of using the decreasing-adjustment formula"", ""$2,500"": ""Used the full 1/11 of the sale price without the (1 - credit ratio) factor""}","{""formula"": ""(1 / 11) * sale_price * (1 - adjusted_gst_credit / full_gst_credit)"", ""params"": {""sale_price"": 27500, ""adjusted_gst_credit"": 3500, ""full_gst_credit"": 5000}, ""expected"": 750.0}","[""GST Act Div 132"", ""GST Act s 132-5""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/rules-for-specific-transactions/business-asset-transactions/gst-and-the-disposal-of-capital-assets | |
| Q136,C,"$1,760",1760.0,AUD,"Concessional cap from 1 July 2024 = $30,000. → Excess concessional contributions (ECC) = 38,000 - 30,000 = 8,000 (added to assessable income, NOT silently capped). → ECC taxed at marginal rate less a 15% offset: effective extra rate = 37% - 15% = 22%. → Extra tax = 8,000 x 0.22 = 1,760.","{""$8,360"": ""Applied the (marginal - 15%) rate to the whole $38,000 contribution instead of only the $8,000 excess"", ""$2,960"": ""Taxed the $8,000 excess at the full 37% marginal rate but forgot the 15% non-refundable offset"", ""$1,760"": ""Correct answer"", ""$0"": ""Assumed the contribution was simply capped at $30,000, so no excess and no extra tax""}","{""formula"": ""(total_cc - cap) * (marginal_rate - offset_rate)"", ""params"": {""total_cc"": 38000, ""cap"": 30000, ""marginal_rate"": 0.37, ""offset_rate"": 0.15}, ""expected"": 1760.0}","[""ITAA 1997 s 291-15"", ""ITAA 1997 s 291-20"", ""ITAA 1997 Subdiv 291-B""]",https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/concessional-contributions-cap | |
| Q137,D,$970.01,970.01,AUD,"2024-25 single base tier is $97,000 or less; $97,001 is $1 over, so Owen is in Tier 1 (1%). → The surcharge applies to the WHOLE income for MLS purposes, not the amount over the threshold. → MLS = 97,001 x 0.01 = 970.01.","{""$0.00"": ""Treated $97,001 as still within the base tier (off-by-one) and charged no surcharge"", ""$0.01"": ""Charged the 1% surcharge only on the $1 above the threshold instead of the whole income"", ""$1,212.51"": ""Used the Tier 2 rate of 1.25% instead of the Tier 1 rate of 1%"", ""$970.01"": ""Correct answer""}","{""formula"": ""income_for_mls * tier1_rate"", ""params"": {""income_for_mls"": 97001, ""tier1_rate"": 0.01, ""threshold"": 97000, ""tier2_rate"": 0.0125}, ""expected"": 970.01}","[""A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999 s 12"", ""Medicare Levy Act 1986 s 8B""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy-surcharge/medicare-levy-surcharge-income-thresholds-and-rates | |
| Q138,C,"$12,500",12500.0,AUD,"Base value for year 2 = 50,000 - 25,000 (year 1 decline) = 25,000 → Diminishing value rate = 200% / 4 years = 50% → Decline in value = 25,000 x (365 / 365) x 50% = 12,500","{""$6,250"": ""Applied the prime cost 100% rate to the base value instead of the 200% rate"", ""$9,375"": ""Used the old 150% diminishing value rate"", ""$12,500"": ""Correct answer"", ""$25,000"": ""Used the original $50,000 cost instead of the reduced $25,000 base value""}","{""formula"": ""base_value * (days_held / days_year) * (dv_factor / effective_life)"", ""params"": {""base_value"": 25000, ""cost"": 50000, ""days_held"": 365, ""days_year"": 365, ""effective_life"": 4, ""dv_factor"": 2.0, ""pc_factor"": 1.0}, ""expected"": 12500.0}","[""ITAA 1997 s 40-25"", ""ITAA 1997 s 40-70""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/general-depreciation-rules-capital-allowances/prime-cost-straight-line-and-diminishing-value-methods | |
| Q139,A,"$4,228",4228.0,AUD,"Interest on $90,000 for 92 days: 5.95% x 90,000 x 92/365 = 1,349.59 → Interest on $66,000 for 243 days: 5.95% x 66,000 x 243/365 = 2,614.78 → Interest on $54,000 for 30 days: 5.95% x 54,000 x 30/365 = 264.05 → Total interest = 1,349.59 + 2,614.78 + 264.05 = 4,228 (rounded to nearest dollar)","{""$4,228"": ""Correct answer"", ""$4,165"": ""Used a simple average of the three balances rather than weighting each by the number of days it was outstanding"", ""$3,213"": ""Applied the rate to the closing balance only for the whole year"", ""$5,355"": ""Applied the benchmark rate to the full opening balance for the whole year, ignoring the repayments and day-weighting""}","{""formula"": ""round(rate*bal1*(days1/365) + rate*bal2*(days2/365) + rate*bal3*(days3/365))"", ""params"": {""bal1"": 90000, ""days1"": 92, ""bal2"": 66000, ""days2"": 243, ""bal3"": 54000, ""days3"": 30, ""rate"": 0.0595}, ""expected"": 4228.0}","[""ITAA 1936 s 109E""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/private-company-benefits-division-7a-dividends/in-detail/division-7a-loans | |
| Q140,A,"$2,865",2865.0,AUD,"Rent = 39 weeks x $160 = 6,240 → Expenses for the flat = 13,500 x one-third x 75% = 3,375 → Net rental income = 6,240 - 3,375 = 2,865","{""$2,865"": ""Correct answer"", ""-$3,885"": ""Apportioned by time only and forgot the one-third floor-area apportionment"", ""-$7,260"": ""Deducted all $9,000 of whole-property expenses against the flat's rent"", ""$1,740"": ""Apportioned by floor area only and forgot the 50% time apportionment (flat rented half the year)""}","{""formula"": ""weeks_rented * rent_per_week - total_expenses * floor_fraction * time_fraction"", ""params"": {""weeks_rented"": 39, ""rent_per_week"": 160, ""total_expenses"": 13500, ""floor_fraction"": 0.3333333333333333, ""time_fraction"": 0.75}, ""expected"": 2865.0}","[""ITAA 1997 s 8-1"", ""IT 2167""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q141,D,$170,170.0,AUD,"Grossed-up assessable income = $700 dividend + $300 franking credit = $1,000 → Tax on grossed-up income at 47% = $1,000 x 0.47 = $470 → Less franking credit tax offset = $300 → Top-up tax payable = $470 - $300 = $170","{""$329"": ""Applied the marginal rate to the cash dividend only, ignoring both the gross-up and the offset"", ""$29"": ""Taxed only the cash dividend (not grossed up) before deducting the franking credit, producing a negative/under-stated result"", ""$470"": ""Grossed up correctly but forgot to subtract the franking credit tax offset"", ""$170"": ""Correct answer""}","{""formula"": ""(dividend + franking_credit) * marginal_rate - franking_credit"", ""params"": {""dividend"": 700, ""franking_credit"": 300, ""marginal_rate"": 0.47}, ""expected"": 170.0}","[""ITAA 1997 s 207-20"", ""ITAA 1997 s 207-35"", ""ITAA 1997 s 67-25""]",https://www.ato.gov.au/businesses-and-organisations/corporate-tax-measures-and-assurance/imputation/receiving-dividends-and-other-distributions | |
| Q142,C,$17.00,17.0,AUD,"Where all-day parking fees are paid periodically, the equivalent daily rate = total fee / business days in the period → Daily rate = 357 / 21 = 17.00 (rounded to the nearest cent) → This $17.00 is the lowest all-day parking rate and is the taxable value of one car parking fringe benefit under the commercial parking station method","{""$11.90"": ""Divided the monthly fee by 30 calendar days instead of the 21 business days"", ""$32.08"": ""Grossed up the daily taxable value by the Type 2 factor before reporting it"", ""$17.00"": ""Correct answer"", ""$357.00"": ""Used the whole monthly fee as the daily rate""}","{""formula"": ""monthly_fee / business_days"", ""params"": {""monthly_fee"": 357, ""business_days"": 21}, ""expected"": 17.0}","[""FBTAA 1986 s 39A"", ""FBTAA 1986 s 39C""]",https://www.ato.gov.au/law/view/document?DocID=SAV/FBTGEMP/00017&PiT=99991231235958 | |
| Q143,C,"$3,017.00",3017.0,AUD,"Taxable value of a loan fringe benefit = interest at the statutory (benchmark) rate minus interest actually charged → Benchmark interest rate for the FBT year ending 31 March 2026 = 8.62% → Notional interest = 35,000 x 8.62% = 3,017 → Actual interest charged = 35,000 x 0% = 0 → Taxable value = 3,017 - 0 = 3,017 (grossed up at the Type 2 rate of 1.8868 to calculate FBT)","{""$1,417.99"": ""Applied the 47% FBT rate to the notional interest instead of reporting the taxable value"", ""$5,692.48"": ""Grossed up the taxable value by the Type 2 factor instead of reporting the pre-gross-up taxable value"", ""$3,017.00"": ""Correct answer"", ""$35,000.00"": ""Treated the whole loan principal as the taxable value""}","{""formula"": ""loan * benchmark_rate - loan * actual_rate"", ""params"": {""loan"": 35000, ""benchmark_rate"": 0.0862, ""actual_rate"": 0.0}, ""expected"": 3017.0}","[""FBTAA 1986 s 16"", ""FBTAA 1986 s 18""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q144,B,$75.00,75.0,percent,"Business-use percentage = (business kilometres ÷ total kilometres) × 100 → = 9,750 ÷ 13,000 × 100 → = 0.75 × 100 = 75%","{""$0.75"": ""Forgot to multiply the fraction by 100 to express it as a percentage"", ""$75.00"": ""Correct answer"", ""$25.00"": ""Used the private (non-business) kilometres in the numerator instead of business kilometres"", ""$133.33"": ""Divided total kilometres by business kilometres (ratio inverted)""}","{""formula"": ""business_km/total_km*100"", ""params"": {""business_km"": 9750, ""total_km"": 13000}, ""expected"": 75.0}","[""ITAA 1997 s 28-90"", ""ITAA 1997 s 28-100""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/income-and-deductions-for-business/deductions/deductions-for-motor-vehicle-expenses/logbook-method | |
| Q145,C,"$4,400",4400.0,AUD,"Total price for the sale = $45,100 paid by Daniel + $3,300 incentive from the manufacturer = 48,400 → GST on a fully taxable sale = one eleventh of the GST-inclusive price → GST = 48,400 / 11 = 4,400","{""$4,100"": ""Used only the $45,100 the buyer paid, omitting the $3,300 incentive that is part of the consideration"", ""$4,840"": ""Took 10% of the GST-inclusive price instead of 1/11"", ""$4,400"": ""Correct answer"", ""$400"": ""Divided the price by 11 twice""}","{""formula"": ""total_sale_price / 11"", ""params"": {""total_sale_price"": 48400, ""amount_paid_by_buyer"": 45100}, ""expected"": 4400.0}","[""GST Act s 9-70"", ""GST Act s 9-75""]",https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/your-industry/motor-vehicle-and-transport/motor-vehicle-incentive-payments/examples-working-out-the-gst | |
| Q146,B,"$2,719.50",2719.5,AUD,"Repayment income = taxable income + RFBA = 61,500 + 16,200 = 77,700 → A 2024-25 repayment income of $77,700 falls in the same 3.5% band ($74,856-$79,346) as the base example → For 2024-25 the rate applies to the whole repayment income: 77,700 x 3.5% = 2,719.50","{""$615.00"": ""Ignored the RFBA and used taxable income at its 1.0% band"", ""$2,719.50"": ""Correct answer"", ""$2,152.50"": ""Applied the correct 3.5% rate but to taxable income only, omitting the RFBA"", ""$3,108.00"": ""Used the next band's 4.0% rate instead of 3.5%""}","{""formula"": ""(taxable_income + rfba) * rate"", ""params"": {""taxable_income"": 61500, ""rfba"": 16200, ""rate"": 0.035, ""taxable_only_rate"": 0.01}, ""expected"": 2719.5}","[""Higher Education Support Act 2003 s 154-1"", ""FBTAA 1986 s 135P""]",https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/reportable-fringe-benefits-for-employees/consequences-of-having-a-reportable-fringe-benefits-amount | |
| Q147,B,$0,0.0,AUD,"Taxable income $16,000 is below the $18,200 tax-free threshold, so income tax = 0. → $16,000 is below the 2024-25 single Medicare lower threshold ($27,222), so Medicare levy = 0. → Total tax = 0 + 0 = 0.","{""$2,880"": ""Taxed the whole $16,000 at 16% and charged a 2% levy, ignoring both the tax-free threshold and the low-income exemption"", ""$0"": ""Correct answer"", ""-$352"": ""Applied 16c to (income minus tax-free threshold), producing a negative figure instead of clamping tax at $0"", ""$320"": ""Charged the 2% Medicare levy despite income being below the low-income threshold""}","{""formula"": ""max(0, taxable_income - tax_free_threshold) * first_rate + max(0, taxable_income - medicare_low_threshold) * medicare_rate"", ""params"": {""taxable_income"": 16000, ""tax_free_threshold"": 18200, ""first_rate"": 0.16, ""medicare_rate"": 0.02, ""medicare_low_threshold"": 27222}, ""expected"": 0.0}","[""Income Tax Rates Act 1986 Sch 7"", ""Medicare Levy Act 1986 s 7"", ""ITAA 1997 s 4-10""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy/medicare-levy-reduction/medicare-levy-reduction-for-low-income-earners | |
| Q148,D,"$56,400",56400.0,AUD,"Capital gain on property = 120,000 → Capital loss on shares = 7,200 (reduced cost base 24,000 - proceeds 16,800) → Offset the capital loss against the gain BEFORE the discount: 120,000 - 7,200 = 112,800 → Apply 50% CGT discount to the remaining gain: 112,800 x 0.5 = 56,400","{""$52,800"": ""Applied the discount before deducting the capital loss"", ""$60,000"": ""Ignored the share capital loss entirely"", ""$63,600"": ""Added the loss to the gain instead of subtracting it"", ""$56,400"": ""Correct answer""}","{""formula"": ""(property_gain - share_loss) * discount_rate"", ""params"": {""property_gain"": 120000, ""share_loss"": 7200, ""discount_rate"": 0.5}, ""expected"": 56400.0}","[""ITAA 1997 s 102-5"", ""ITAA 1997 s 110-55"", ""ITAA 1997 s 115-100""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/calculating-your-cgt/how-to-calculate-your-cgt | |
| Q149,B,"$1,616",1616.0,AUD,"Indexation factor = 123.4 / 79.8 = 1.546 → Indexed cost base = 4,000 x 1.546 = 6,184 → Capital gain (indexation method) = 7,800 - 6,184 = 1,616 → Under the indexation method the CGT discount does not apply","{""$808"": ""Wrongly applied the 50% discount on top of the indexation method"", ""$1,616"": ""Correct answer"", ""$1,900"": ""Used the discount method on the unindexed gain instead of indexation"", ""$3,800"": ""Used the unindexed cost base instead of indexing it""}","{""formula"": ""proceeds - cost * indexation_factor"", ""params"": {""proceeds"": 7800, ""cost"": 4000, ""indexation_factor"": 1.546, ""discount_rate"": 0.5}, ""expected"": 1616.0}","[""ITAA 1997 s 104-10"", ""ITAA 1997 s 114-1"", ""ITAA 1997 s 960-275""]",https://www.ato.gov.au/forms-and-instructions/capital-gains-tax-personal-investors-guide-2013/part-b-sale-of-shares-or-units/b2-worked-examples-for-shares-and-units | |
| Q150,A,"$41,600",41600.0,AUD,"Taxable value of a housing fringe benefit = market rental value of the right to occupy minus any recipient's (employee) rent → Market rental value for the year = 49,400 (52 weeks x $950) → Recipient rent paid by the employee = 7,800 (52 weeks x $150) → Taxable value = 49,400 - 7,800 = 41,600","{""$41,600"": ""Correct answer"", ""$49,400"": ""Ignored the recipient rent paid by the employee"", ""-$44,200"": ""Treated the $7,800 annual rent as a monthly figure and multiplied it by 12"", ""$31,200"": ""Wrongly applied a 75% reduction (which applies to certain hotel/caravan staff housing, not a CBD flat)""}","{""formula"": ""market_rental - recipient_rent"", ""params"": {""market_rental"": 49400, ""recipient_rent"": 7800}, ""expected"": 41600.0}","[""FBTAA 1986 s 25"", ""FBTAA 1986 s 26""]",https://www.ato.gov.au/forms-and-instructions/fringe-benefits-tax-return-2026-instructions/item-23-fringe-benefit-categories-for-fbt-return-2026 | |
| Q151,B,"$300,000",300000.0,AUD,"The asset was acquired after 8 May 2012 and Diego was a foreign resident for the entirety of his ownership period → In that case he is not entitled to ANY CGT discount, despite owning the asset for more than 12 months → There is no period of Australian residency, so no apportioned discount is available either → Capital gain to declare = full gain = 300,000","{""$150,000"": ""Trap: applied the full 50% discount because the asset was held over 12 months, ignoring the foreign-residency exclusion"", ""$300,000"": ""Correct answer"", ""$225,000"": ""Applied a partial (25%) apportioned discount even though there was no Australian residency period"", ""$75,000"": ""Applied the 50% discount and halved it again""}","{""formula"": ""gain"", ""params"": {""gain"": 300000, ""discount_rate"": 0.5}, ""expected"": 300000.0}","[""ITAA 1997 s 115-105"", ""ITAA 1997 s 115-115"", ""ITAA 1997 s 115-25""]",https://www.ato.gov.au/individuals-and-families/investments-and-assets/capital-gains-tax/foreign-residents-and-capital-gains-tax/cgt-discount-for-foreign-residents | |
| Q152,B,"$13,017",13017.0,AUD,"Roberto's income ($74,000) is in the $48,001-$90,000 flat LMITO band, so the LMITO is the full $1,500 → Tax payable before offset = 14,517 (2021-22 rates: 5,092 + (74,000 - 45,000) x 0.325 = 5,092 + 9,425) → Net tax payable = 14,517 - 1,500 = 13,017","{""$14,517"": ""Forgot to apply the $1,500 LMITO at all"", ""$13,017"": ""Correct answer"", ""$16,017"": ""Added the offset to tax payable instead of subtracting it"", ""$12,317"": ""Also subtracted a $700 LITO, but Roberto is not eligible for the LITO above $66,667""}","{""formula"": ""tax_payable_before_offset - lmito"", ""params"": {""tax_payable_before_offset"": 14517, ""lmito"": 1500}, ""expected"": 13017.0}","[""ITAA 1997 s 4-10"", ""ITAA 1997 s 61-575"", ""Income Tax Rates Act 1986 Sch 7""]",https://www.ato.gov.au/forms-and-instructions/low-and-middle-income-earner-tax-offsets | |
| Q153,C,"$8,100",8100.0,AUD,"Laptop: business-use portion = 75% x 9,200 = 6,900 → Label printer: used 100% for business = 1,200 → Combined deduction = 6,900 + 1,200 = 8,100","{""$7,800"": ""Wrongly applied the 75% business-use factor to the printer as well"", ""$6,900"": ""Omitted the printer entirely"", ""$8,100"": ""Correct answer"", ""$10,400"": ""Claimed the full laptop cost, ignoring the 25% private-use reduction""}","{""formula"": ""computer_cost * computer_business_pct + printer_cost"", ""params"": {""computer_cost"": 9200, ""computer_business_pct"": 0.75, ""printer_cost"": 1200}, ""expected"": 8100.0}","[""ITAA 1997 s 328-180"", ""IT(TP)A 1997 s 328-180""]",https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/depreciation-and-capital-expenses-and-allowances/simpler-depreciation-for-small-business/instant-asset-write-off | |
| Q154,A,"$37,500",37500.0,AUD,"Aggregated turnover is under $50m → A company is a base rate entity if 80% OR LESS of assessable income is base rate entity passive income → Passive income is exactly 80%, which satisfies the '80% or less' test, so the company IS a base rate entity → The 25% base rate entity rate applies: $150,000 x 25% = $37,500","{""$37,500"": ""Correct answer"", ""$45,000"": ""Treated exactly 80% as failing the test and applied the 30% full rate, but 80% satisfies the '80% or less' test"", ""$7,500"": ""Applied only the 5% rate differential instead of the 25% base rate entity rate"", ""$41,250"": ""Used the superseded 27.5% base rate entity rate from an earlier income year""}","{""formula"": ""taxable_income * rate_bre"", ""params"": {""taxable_income"": 150000, ""rate_bre"": 0.25, ""rate_full"": 0.3, ""rate_old"": 0.275}, ""expected"": 37500.0}","[""ITRA 1986 s 23"", ""ITAA 1997 s 23AA"", ""ITAA 1997 s 23AB""]",https://www.ato.gov.au/tax-rates-and-codes/company-tax-rate-changes | |
| Q155,B,$150.00,150.0,AUD,"Rent received = 31 × $650 = 20,150 → Apportion general expenses to the 31 weeks rented/available: (31 / 52) × 26,000 = 15,500 → Add the fully deductible agent fees ($1,500) and the full-year capital works deduction ($3,000): 15,500 + 1,500 + 3,000 = 20,000 total deductions → Net rental income = 20,150 − 20,000 = 150","{""-$10,350.00"": ""Deducted the full year of general expenses instead of apportioning to the 31 weeks rented"", ""$150.00"": ""Correct answer"", ""$3,150.00"": ""Omitted the $3,000 capital works (Division 43) deduction"", ""$755.77"": ""Apportioned the agent fees by weeks too, instead of claiming them in full""}","{""formula"": ""weeks_rented*rent_per_week - ((weeks_rented/weeks_in_year)*gen_expenses + agent_fees + capital_works)"", ""params"": {""weeks_rented"": 31, ""rent_per_week"": 650, ""gen_expenses"": 26000, ""weeks_in_year"": 52, ""agent_fees"": 1500, ""capital_works"": 3000}, ""expected"": 150.0}","[""ITAA 1997 s 8-1"", ""ITAA 1997 Div 43"", ""IT 2167""]",https://www.ato.gov.au/forms-and-instructions/rental-properties-2025/rental-expenses | |
| Q156,D,"$1,070.00",1070.0,AUD,"Income for MLS purposes = taxable income + reportable fringe benefits = 84,000 + 23,000 = 107,000 → $107,000 is in the single Tier 1 range ($101,001-$118,000), the same tier as the base example, so the MLS rate is 1% → MLS = 107,000 x 1% = 1,070","{""$840.00"": ""Applied the MLS to taxable income only, omitting the reportable fringe benefits"", ""$1,605.00"": ""Used the Tier 3 rate of 1.5% instead of the Tier 1 rate"", ""$1,337.50"": ""Used the Tier 2 rate of 1.25% instead of the Tier 1 rate"", ""$1,070.00"": ""Correct answer""}","{""formula"": ""(taxable_income + reportable_fringe_benefits) * mls_rate"", ""params"": {""taxable_income"": 84000, ""reportable_fringe_benefits"": 23000, ""mls_rate"": 0.01}, ""expected"": 1070.0}","[""A New Tax System (Medicare Levy Surcharge—Fringe Benefits) Act 1999"", ""Medicare Levy Act 1986 s 8B-8G""]",https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/medicare-levy-surcharge/medicare-levy-surcharge-income-thresholds-and-rates | |