David and Emma are married and have some investment properties jointly in Sydney. To structurally manage their investment properties, they signed a formal partnership agreement, and agreed that the net profits from their rental properties would be distributed 95% to Emma and 5% to David. They also agreed that David bear the total losses from the investments. Required: With reference to the relevant laws, critically discuss whether David and Emma are in a partnership as investors? Also, discuss whether they are required to lodge a partnership tax return?

Answer rating: 100% (QA)

The profitsharing ratio is 95 5All the losses have to be bared by David who is only earning 5 of the profits Both of them signed the partnership agree... View the full answer