AFM362 Chapter Notes - Chapter 4: Property Income, Withholding Tax, Deferred Income
16 Dec 2018
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Distinct source: each business must be recognized as a distinct source of income, separate from employment income, income from property, and taxable capital gains. General rule for determining income or loss: only deductions applicable to a specific source may be claimed against income from that source. Business income: a taxpayer"s income (loss) for a taxation year from a business is their profit (loss) from that bu siness for the year. Business income vs property income: if the income is passive (requires little or no activity by the taxpayer), it is property income. If the income is active (requires time and e ffort), it is business income. Property: property that would produce property income includes: A right of any kind, a share or a ch os e (contractual right) in action. Unless a contrary intention is evident money. Work in progress of a business that is a profession. Distinctions between the treatment of business and property income:
