1. The tax payable by Jane is calculated by considering various provisions mentioned under law. Every entities, companies and individual are required to make tax payment under section 4-1 of the Income Tax Assessment Act. After subtracting all the allowable deductions from assessable income, tax amount is calculated as per section 4-15 of the Income Tax Assessment Act 1997. Statutory income and ordinary income are the classification of the assessable income. As per both the sections mentioned above, the income received by resident from all the sources are taxable and nonresident Australian is required to pay taxes on income generated in Australia. It has been assumed that Jane is an Australian resident for consideration of taxation purpose. Salary of Jane comprise of part of assessable income as per section 6-5 of the Income Tax Assessment 1997. According to section 6-5 of the Income Tax Assessment Act 199, the amount of fully franked dividend received by Jane is also taxable.
According to section 6-5 of the ITAA 1997, assessable income for taxation purpose would include interest amount of $ 475. The taxable income of Jane is calculated based on above discussion and it is depicted from calculation that amount of tax payable by Jane brown is $ 34715. It has been assumed in the calculation that interest amount of $ 15000 is included in mortgage repayment.
2. Green Pty Limited is an Australian resident company and business income are taxable according to Income tax Assessment Act. Since the turnover of Green Pty limited is less than 2 million, the corporate tax rate of 28.5% is applicable. Under section 27-15 of the Income Tax Assessment Act, the income tax credit can be deducted as loss and such expenses need to be adjusted to GST elements. In general, the company is required to make tax payment of rate 30% and the amount of dividend provided is considered as gross.
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