Sara has had the same best friend 'Jodee' since she was 7 years old. Sara and Jodee lived next door to each other when they were children. Now that they are adults, they have realised that they still want to live close to each other. During a recent holiday together, they discussed the possibility of buying houses in the same suburb. Since they both have large income each year from their employment and business activities, they devise a plan of how they could use the ownership of the new homes to reduce their income tax payable. Both Jodee and Sara decide to purchase a house each. Jodee lives in the house that Sara purchased and pays rent for the use of Sara's property. Sara lives in the house that Jodee purchased and pay rent for the use of Jodee's property. Paying rental income to each allows both Sara and Jodee the ability to claim deductions for any costs incurred in maintaining their respective properties. Required: Discuss whether Sara and Jodee's activities have any tax consequences