Bill recently bought a 3-bedroom house which he rents out for $450 a week. His tenant first started paying rent on 10 October. Bill took out a $600,000 loan at 3.5% per annum interest to help purchase this property. His first interest payment coincided with his tenant's rental payment. Bill's agent charges him 2% of his rent received as a fee. Bill also paid $500 a year to insure the house; council rates of $2,100; water rates of $1,200. Bill has an annual salary of $110,000, and $500 per annum in work related deductions. 

a. Ignoring Medicare levies and offsets, what is Bill's tax payable? Please present your detailed calculation (10 marks)

b. Is Bill negatively, positively or neutrally geared? How would your answer change if Bill's loan were for $300,000? Recalculate his tax payable on this basis to explain your answer.