Task Question
Danny, a tax resident of Australia, was electrical technician working in Robin Pty Ltd. He had recently resigned from that company to undertake a three year studies at Charles Sturt University. This move would upgrade his qualification from a Certificate in Electronics to a Degree in Electrical Engineering. His employer, Jack had verbally indicated that he could return to his position upon the completion of his studies. However there was no discussion if he would be offered an increase in salary or promotion.
During the first half of the current income year, Danny participated in a student exchange program with the Nanyang Univrsity in Singapore. The cost incurred were all substantiated were as follows:
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Air ticket
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$1,500
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Accommodation
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$2,000
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Meals
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$1,200
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Books and study materials
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$800
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Purchase of laptop
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$1,800
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Purchase of motor vehicle (used for 5 months)
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$8,000
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Of the six months during Danny's trip to the Singapore, five months were engaged in his studies. He spent the remainder of the months on holiday activities. The primary purpose of the trip to Singapore was for his studies.
While he was engaged in his studies, Danny worked as a casual tutor in the university. He was paid $4,000 by Nanyang University.
Danny hopes to return to Australia after his studies and continue his employment with Robin Pty Ltd with a substantial increase in salary and promotion.
Required - Advise Danny if the cost that he had incurred are allowable for deduction. You must cite the relevant case law and legislation.