Australian Taxation

Bill and Bob have been partners in an accounting practice for the past 10 years. Bob has decided to sell his half share of the practice to Bill and travel overseas. As part of the sale contract, Bob has signed an agreement to say he will not establish or work for another accounting firm within a period of three years or a radius of 100km. Bill paid Bob a lump sum of $100,000 and will pay a further $20,000 per year for the next three years as a result of this agreement. Explain: if the payments made by Bill will be deductible, and if the amounts received by Bill will be assessable.