Henry, a former professional football player, thoroughly enjoys his retirement, partying hard and blowing all his endorsement

Fantastic news! We've Found the answer you've been seeking!

Question:

Henry, a former professional football player, thoroughly enjoys his retirement, partying hard and blowing all his endorsement earnings on a good time. After waking up with a serious hangover one morning, Henry decided to take charge of his life and kick his bad habits. His first step was to enrol into a Bachelor of Arts, Bachelor of Commerce (Journalism/Public Relations). Henry also lands a job working part-time as a field reporter for channel 12 and writes a weekly column in the weekend newspaper, primarily covering sports-related news.

Henry's university studies are Commonwealth supported. His fees for the first year of study totalled $8,000 all of which were covered by FEE-HELP. He also incurred the following expenses in relation to his study:

Travel from home to uni: $100

Travel from uni to work: $100

Travel from work to uni: $100

Travel from uni to home: $100

New laptop: $1,500

Journalism software: $200

Textbooks: $300

Henry proves to be an excellent media personality and wins a prize for his efforts as the best media person for the year. The prize is a four-week all expenses paid trip to the USA and his employer is also paying him to cover the American Sports for 2 weeks whilst he is there. Henry incurred the following expenses in relation to his trip.

Costs incurred whilst undertaking sightseeing in the US $1750

Meals and incidentals whilst attending sporting events $ 860

Doctors fee and painkillers as he injured himself whilst on the trip $1250

Purchase of American Sports Merchandise for his collection $2100

Prior to him leaving for the trip his employer Channel 12 news, gave him a LV carry bag to reward him for winning the prize if was valued at $4500.

Inspired by his efforts at university and at work, Henry decided to renovate his house to include an office and library. He refinanced the equity in his home and borrowed an additional $90,000 for the project. The loan was taken over 5 years and the monthly repayments were $1,200 which was for the interest and principle. In the 2021 financial year the interest was $6,480 on this loan. He also used part of the funds to buy the following (all purchases were made five days prior to the completion of the renovation):

Desktop: $2,000

Office chair: $150

Desk: $500

Monitor: $150

Keyboard and mouse: $100

Printer: $150

Bookshelves: $600

Complete works of Game of Thrones: $2,500

In his 2020 income tax return, Henry claimed all expenses as tax deductions; including fees paid on his FEE-HELP and interest on the loan.

Henry lodged his 2020 income tax return via his MyGov account on 5^th September 2020 and The Commissioner issued Henry with a tax assessment dated 18 September 2020 and Henry was extremely happy to receive a sizable tax refund.

Unfortunately, Henry's return came under review after a routine desk audit conducted by the ATO. He has now received an amended assessment dated 20 April 2021 disallowing all travel expenses both for uni and his trip overseas, the FEE-HELP fees, interest of $6,480, and all expenses relating to the home office and library as well the Commissioner included the value of the LV in his assessable income as the Commissioner considered that the expenditure was contrary to the provisions of the Income Tax Assessment Acts which relate to deductions both general and specific and that the LV carry case was a form of assessable income.

Henry believes that the ATO is incorrect in their assessment, and he wishes to object against the amended assessment.

Your Task

Review and consider the legislation, case law and ATO rulings in relation to the issues presented above and complete the following:

As an Annexure to the ATO Objection Form prepares an Objection Letter which fully and in detail sets out the grounds of objection. Please Provide reference as well.