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Discuss the deductibility for the below amounts of $4,000 and $12,000 and $1,500 incurred by Lucy Lucy is an architect who works from home in

Discuss the deductibility for the below amounts of $4,000 and $12,000 and $1,500 incurred by Lucy

Lucy is an architect who works from home in Kew. She has a designated workplace which occupies a quarter (25%) of the floorspace of her house. This home workspace has a separate entrance from the remainder of the house (at the rear) and is divided into two sections. One section is a formal meeting room for advising clients (who access this area through the separate entrance) and the other is for her architectural drawings. Her family are not allowed into these spaces and the spaces cannot be accessed through the main part of the house.

This year, in relation to the total expenses for her Kew home, Lucy incurs $4,000 in electricity expenses and she also incurs $12,000 in interest payments on her mortgage. She also contributes $1,500 to an Australian political party called Aussie Homeowners Association as their policies promote increased tax incentives for architects.

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