Sunil Agarwal, a resident taxpayer, purchased a townhouse in Sydney as an investment property on 1 July 2019 which he made available for lease by tenants. Details of the purchase were as follows:
Purchase Price $ 478,000
Stamp Duty $ 17,000
The vendor provided Sunil with a certified schedule indicating that the eligible construction costs of the property amounted to $140,000 (constructed in 2010). The schedule also specifies that the adjustable value of fittings was $14,500 and has a remaining useful life of 5 years.
Sunil recorded the following transactions for the 2019/20 tax year in respect of the property:
Receipts
Rent received (net of agent's commission of $2,100) $ 41,900
Recovery from the Rental Bond Board (tenant damage March 2020) $ 820
Reimbursement of water rates (usage portion only) $ 740
Rebate from State government for washing machine
- purchased on 1 Oct 2019) $ 150
Payments
Mortgage repayments to ANZ Bank - principal $ 2,100
Mortgage repayments to ANZ Bank - Interest $ 27,100
Loan establishment fees to ANZ Bank for a 15-year mortgage
paid upon commencement of loan 1 July 2019 $925
Council and Water Rates $ 3,560
Building Insurance Premiums $ 610
Repair of carpetcarried out on 19 July 2019 in respect of damage by previous owner $ 1,845
Repair of gutteringcarried out on 27 March 2020 in respect of damage by tenants $ 830
Renovation of bathroomcompleted on 1 January 2020 $ 8,500
Travel costs (refer to other information) $ 3,200
Purchase of washing machine1 October 2019, 5-year effective life $ 1,250
Purchase of ceiling fans - 19 April 2020, 10-year effective life $ 240
Other Information:
Sunil lives in Ballina. During the 2019/20 tax year Sunil made 4 trips to Sydney.
Applied Education
Each trip cost a total of $800. One of the trips was taken in July 2019 to finalize the purchase of the property; another trip taken during May 2019 was to view another property that Sunil was considering purchasing; the remaining 2 trips were taken during the year in order to inspect the rental property
Sunil also received a gross salary for the year of $96,480 from which $25,000 of PAYG tax was withheld.
Sunil has diarised $470 of work-related expenditure including a briefcase costing $280 and $190 of stationery; and 5 work-related journals (each costing less than $10). He has not retained any receipts.
Sunil was not covered by adequate private health insurance.
REQUIRED:
a) calculate Sunil's taxable income for the 2019/20 tax year.
b) Explain below how your calculation of eligible deductions would have been different if this was for the 2015/2016 tax return.
c) Write an email to your client advising him of:
 The change in tax law for claiming travel expenses as a deduction and how this will affect future tax returns.
 Record-keeping requirements for claiming eligible deductions.