Question 1 (10 Marks)
Alan is an employee at ABC Pty Ltd (ABC). He has negotiated the forthcoming compensation bundle after a while ABC: • hire of $300,000; • Payment of Alan's ductile phone mandible ($220 per month, including GST). Alan is lower a two-year reduce whereby he is required to pay a unwandering sum each month for infinite performance of his phone. Alan uses the phone for work-related purposes barely; • Payment of Alan's children's ground fees ($20,000 per year). The ground fees are GST loose.
ABC too granted Alan after a while the hindmost ductile phone handset, which absorb $2,000 (including GST).
At the end of the year ABC hosted a dinner at a persomal Thai restaurant for all 20 employees and their partners. The whole absorb of the dinner was $6,600 including GST.
(a) Advise ABC of its FBT consequences arising out of the over instruction, including anticipation of any FBT obligation, for the year conclusion 31 March 2017. Assume that ABC would be entitled to input tax credits in aspect to any GST-inclusive acquisitions. (b) How would your defense to (a) dispute if ABC barely had 5 employees? (c) How would your defense to (a) dispute if clients of ABC too animated the end-of-year dinner?