e. when the sessions are actually held. As only one of the ten sessions paid for has been held, nine sessions are unearned revenue and you are only required to include $80 as assessable income on your 2007 tax return.
In order to strengthen your case for this objection, we also require information on whether the unearned revenue is being kept in a distinct account, and whether you allow unconditional refunds for fees received in advance.
4. EXPLANATION OF OBJECTIONS MADE TO AMENDED ALLOWABLE DEDUCTIONS
4.1 Week-end with Janz
While we agree with the Commissioners assessment that the value of the conference prize should be included as income, we also believe this amount is deductible. This will result in a net effect of zero taxable income for this amount.
The $3,000 value is assessable firstly because the prize was obtained at a business-related conference. Secondly, as you applied your skill and knowledge to win the prize, you won the prize in the course of your business activities. However, this amount will also be claimable as a deduction, as the prize was an intensive, business-related training weekend, rather than a personal holiday or cash bonus.
4.2 Guard dog
The Commissioner has attempted to disallow this deduction based on existing case law; however your case can be distinguished. The guard dog is considered to be a security device; therefore the purchase price of a guard dog is deductible only if it is used for business purposes. The sum is deductible because you have apparently purchased the dog for business-only purposes; despite the fact that your home business premises constitute only 10% of the floor space. The fact that your purpose is solely business-related means that the full amount of $900 should be deductible.
To further strengthen this objection, we also require further information on whether the d View More »