Helmut is an Engineer who lives in Brisbane, Queensland. Helmut is employed by an overseas engineering Firm and usually operates from their Brisbane office. During the 2023 tax year, however, Helmut was posted to Singapore for 2 months (January and February of 2023). Helmut returned to their usual posting in Brisbane, Australia, on 1 March 2023.
Helmut derived the following amounts of ordinary income during the income tax year 2022-2023:
AU D$ Wages net of AUD$26,520 tax (paid and taxed in Australia) 59,800 Wages net of AUD$3,520 tax (paid and taxed in Singapore) 6,430 Interest income (interest-bearing bank account held in Australia) 50 Interest income net of AUD$150 withholding tax (term deposit held in Singapore) 850 Rental income (rental property located in Australia) 9,000
Other information:
• Helmut incurred expenditure of AUD$1,000 pursuant to s8-1 ITAA97 and of AUD$1,750 pursuant to s8-5 ITAA97. • The expenses Helmut incurred are GST-inclusive. • Assume the wages earned by Helmut while working in Singapore are not exempt income. • Regarding the Singapore wages and term deposit, the same wage and interest earning activities would only be liable to AUD$2,000 and AUD$100 tax if taxed in Australia. • Helmut does not have private health insurance. • Helmut is single with no children. • Ignore double tax agreements.
REQUIRED
Determine the Australian income tax consequences of the above fact situation for the year ending 30 June 2023 by answering the following question set.
In doing so, you must show a complete analysis to be awarded full marks, including references to appropriate sources of tax law, presenting all workings and/or explanations.