During an audit of his income tax return, Selwyn Vasic was found to have omitted $10000 of assessable income. The tax return originally lodged by Selwyn disclosed taxable income of $125000. Selwyn has adequate private health insurance.

a) Calculate the Shortfall Amount

b) Calculate the likely penalties that would be imposed on Selwyn if the shortfall was a result of:

1 A lack of reasonable care to comply with taxation law- how much penalty

2 Recklessness as to the operation of taxation law- how much penalty

3 Intentional disregard for the law- how much penalty