Samual owns two investment properties in Sydney (NSW).

One of his two properties, (Property A) is rented out and provides Samual with an annual rental income of $15,000.

The other property (Property B) has never been rented out, instead, is used privately by Samual and his family during school holidays.

During the 2021 tax year, Samual incurred the following expenses:

Property A:

• Council rates and taxes paid - $1,000
• Insurance paid - $2,000
• Interest paid to West Bank on loan to purchase the property - $20,000
• Cost of building an extra bedroom to the back of the house - $30,000

Property B:

• Council rates and taxed paid - $1,000
• Insurance paid - $2,000

Required: Refer to sections in the legislation and/ or cases and advise Samuel of his total property related deductions for the 2021 tax year. Be sure to provide explanations and legal references for any amounts you excluded.