During the 2021 tax year, Clive (a business taxpayer who owns an IT support business) reported gross income from services totalling $150,000. Clive uses a cash basis accounting method for taxation and clients are required to pay invoices within 7 days of issue.

Clive also reported the following transactions:

- On 10 February 2021, Clive rebuild Toms computer, the invoice totalling $275.

- On 20 March 2021, Clive learned that Tom was wanted by the police

- On 30 June 2021 Clive was unsure whether Tom would pay his invoice

- On 10 April 2021, Clive installed new computers for Sanjays internet caf, the invoice totalling $7,575.

- On 30 June 2021, Clive learns that Sanjays has become bankrupt.

- On 1 July 2021, Clive wrote off Sanjays debt in his business records.

Required:

Advise Clive as to whether he can claim either of the above two transactions as bad debts for the 2021 tax year. You must refer to sections in the Tax Acts and explain your answers.