Henry, a tax resident of Australia, was a famous jazz singer who passed away rec
ID: 2526994 • Letter: H
Question
Henry, a tax resident of Australia, was a famous jazz singer who passed away recently. Jack, a publisher was interested on Henry's life story and wanted to write a bibliography on Henry's life. Jack approached Henry's wife, Jenny (also a tax resident of Australia) to interview her on Henry's life story. She was offered $1 million for Henry story. Jenny was paid $500,000 deposit before the interview. After the interview she was paid the balance of the money.
Would the tax consequences have changed if Jenny had written the book herself?
Required
Advise Jenny on her tax consequences.
You must cite the relevant case law and legislation
Explanation / Answer
As per the above case Jenny had the moral rights.In 2000, moral rights were recognised in Australian copyright legislation. Only individuals may exercise moral rights.
On 27 June 2007, the Australian Taxation Office (ATO) released for public comment draft taxation ruling TR 2007/D5 (Ruling).
The Ruling contains the Commissioner of Taxation's (Commissioner) view on the circumstances in which consideration for an assignment of copyright will be treated as a royalty.
Royalty payments are generally subject to withholding tax under Division 11A, Part III of the Income Tax Assessment Act 1936 (ITAA36). The standard rate of withholding tax is 30%, but is reduced under most double tax agreements.
As per the above case Jack has to register copyright act of 1968 before publishing.
Registration is not required to establish copyright protection, but registration is necessary before bringing a lawsuit. Registration is also useful because it creates a presumption of a valid copyright, it allows the plaintiff to collect enhanced "statutory damages", and to be eligible for an award of attorney fees
Until 2004, copyright in Australia was based on the "plus 50" law which restricts works until 50 years after the author's death. In 2004 this was changed to a "plus 70" law in line with the USA and European Union.
The law is designed to protect an individual’s own material such as articles, programmes, scripts or songs as well as those who publish the material such as newspapers, broadcasts and film and music producers.
Copyright infringement occurs when someone violates one of the exclusive rights listed in 17 USC 106. Commonly, this involves someone creating or distributing a "copy" of a protected work that is "substantially similar" to the original version.
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