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Scorching Motors sells a fuel-efficient luxury car to Joel for an 'all up' price of $106500, including GST (10%) and Luxury Car Tax (33%)
Scorching Motors sells a fuel-efficient luxury car to Joel for an 'all up' price of $106500, including GST (10%) and Luxury Car Tax (33%). This price does not include stamp duty, registration or compulsory third party insurance.
Calculate:
1. The LCT (using the 2018-19 threshold amount)
2. The GST Scorching Motors must pay on this sale.
(all answers to 2 decimal places)
Tip: If you cannot find the threshold for the 2018-19 financial year in your textbook, visit www.ato.gov.au and search for 'LCT threshold'.
Required to calculate :
|
LCT = |
Answer for part 1
|
|
GST = |
Answer for part 2 |
Expert Solution
To begin with, the Luxury Vehicle Tax is indeed a tax imposed on vehicles with a GST including purchase worth exceeding a certain level. The minimum price for the fuel-efficient automobile is $75526.00
Part 1
Calculate the LCT;
-The LCT is valued at $106500.00
- The LCT value is above the threshold.= $106500 - $75526 = $30974.00
-GST is included in the reversal of the LCT.= $30974 divided by 1.43 = $21660.14
- LCT is used at a rate of 33percent.= $21660.14*33percent = $7147.85
Part 2
-GST calculations;
-LCT is not included in the value= $106500.00 - $7147.85 = $99352.15
-GST monetary value= ($99352.15 divided by 1.10) * 10percent = $9032.01
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