Assume that:

$$ Johnstone and Joleen Straw each own $50\%$ of the issued shares in the company. The Straws are to be assessed for taxation purposes in the current financial year as a small business on the cash basis.

$$ The company is to be assessed for taxation purposes in the current financial year as a small business, on the cash basis.

$$ The company contributed $$20,000$ into a superannuation fund on Johnstone$$s behalf, which is a taxation deduction to the company. For the purpose of this case study, ignore the impact of the commissions paid or incurred on the superannuation contributions paid into the superannuation fund for Johnstone.

$$ All net profits of the company after tax for the year ended $30$th June in the current year are paid as dividends to Johnstone and Joleen $($for the purposes of any case study questions you should assume that the dividends are paid to Johnstone and Joleen in the current income taxation year and that the company tax was also paid in the current year, prior to the payment of dividends$).$ Note that the dividends are paid rather than the salary amounts.

$($a$)$ Using Microsoft Excel calculate the tax payable for both Johnstone and Joleen for the year ending on the $30$th of June of the current year, knowing that the Straw$$s operate in a partnership called J & J Straw Motors. A written partnership agreement provides that income$/$losses will be shared equally. Summarize the total tax and Medicare levy paid under this scenario.

$($b$)$ Calculate the total tax payable by the Company or company and trust structure and Johnstone and Joleen for the year ending on the $30$th of June of the current year, on the assumption that the partnership was incorporated into a private company, J & J Straw Motors Pty$.$ Ltd$.$ at the beginning of the current financial tax year. Summarise the total tax and Medicare levy paid under this scenario.