Question: partnership net income and tax liability scenario partnership pizza...
Source of income – foreign income
Background Scenario – Jovanni P/L
Jovanni P/L is a manufacturer of shoes, whose directors reside in Italy and conduct most of director meetings in Italy. Jovanni P/L was incorporated in Italy and 80% of its shareholders are Italian. It exports its shoes around the world. Jerrrabomberah P/L is an Australian primary producer and manufacturing company that raises young cattle, pigs and goats to make sales of meat, but also to tan the hides of the animals and supply them to Julius P/L to make shoes in Italy. While in Australia, the directors of Julius P/L enter into a contract with an unrelated company, Jolimont P/L that distributes shoes nationally to stores around Australia.
Jovanni P/L has the following receipts in 2019-20
1. Interest income
Jovanni P/L has an Australian bank account where all of its Australian business receipts are deposited and derives interest from that account.
2. Contract business income
Jovanni P/L receives income from the sale of shoes to Jolimont P/L.
For the 2019-2020 year of tax, based on source rules/residency, what receipts need to be included in Jovanni P/L’s assessable income regarding:
a) interest income 3 marks, and
b) contract business income 2 marks