Income Tax Assessment Act 1997

Act No. 38 of 1997 as amended

This compilation was prepared on 19 December 2006
taking into account amendments up to Act No. 168 of 2006

Volume 1 includes:         Table of Contents
                                      Sections 1‑1 to 36‑55

The text of any of those amendments not in force
on that date is appended in the Notes section

The operation of amendments that have been incorporated
may be affected by application provisions that are set out in
the Notes section

Volume 2 includes:         Table of Contents
                                      Sections 40‑1 to 55‑10

Volume 3 includes:         Table of Contents
                                      Sections 58‑1 to 122‑205

Volume 4 includes:         Table of Contents
                                      Sections 124‑1 to 152‑430

Volume 5 includes:         Table of Contents
                                      Sections 164‑1 to 220‑800

Volume 6 includes:         Table of Contents
                                      Sections 240‑1 to 410‑5

Volume 7 includes:         Table of Contents
                                      Sections 700‑1 to 727‑910

Volume 8 includes:         Table of Contents
                                      Sections 768‑100 to 995‑1

Volume 9 includes:         Note 1
                                      Table of Acts
                                      Act Notes
                                      Table of Amendments
                                      Notes 2–8
                                      Table A

Prepared by the Office of Legislative Drafting and Publishing,
Attorney‑General’s Department, Canberra

  

  

  

Contents

Chapter 1—Introduction and core provisions                                                         1

Part 1‑1—Preliminary                                                                                                           1

Division 1—Preliminary                                                                                              1

1‑1......... Short title [see Note 1]....................................................................... 1

1‑2......... Commencement.................................................................................. 1

1‑3......... Differences in style not to affect meaning.......................................... 1

Part 1‑2—A Guide to this Act                                                                                          2

Division 2—How to use this Act                                                                            2

Subdivision 2‑A—How to find your way around                                                     2

2‑1......... The design........................................................................................... 2

Subdivision 2‑B—How the Act is arranged                                                            3

2‑5......... The pyramid....................................................................................... 3

Subdivision 2‑C—How to identify defined terms and find the definitions         4

2‑10....... When defined terms are identified...................................................... 4

2‑15....... When terms are not identified............................................................. 4

2‑20....... Identifying the defined term in a definition........................................ 5

Subdivision 2‑D—The numbering system                                                              5

2‑25....... Purposes............................................................................................. 5

2‑30....... Gaps in the numbering........................................................................ 6

Subdivision 2‑E—Status of Guides and other non‑operative material               6

2‑35....... Non‑operative material....................................................................... 6

2‑40....... Guides................................................................................................. 6

2‑45....... Other material..................................................................................... 7

Division 3—What this Act is about                                                                       8

3‑1......... What this Act is about........................................................................ 8

3‑5......... Annual income tax.............................................................................. 8

3‑10....... Your other obligations as a taxpayer.................................................. 9

3‑15....... Your obligations other than as a taxpayer........................................ 10

Part 1‑3—Core provisions                                                                                                11

Division 4—How to work out the income tax payable on your taxable income  11

4‑1......... Who must pay income tax................................................................ 11

4‑5......... Meaning of you................................................................................. 11

4‑10....... How to work out how much income tax you must pay................... 11

4‑15....... How to work out your taxable income............................................. 13

4‑25....... Special provisions for working out your basic income tax liability.. 15

Division 6—Assessable income and exempt income                                16

Guide to Division 6                                                                                                    16

6‑1......... Diagram showing relationships among concepts in this Division.... 16

Operative provisions                                                                                                 17

6‑5......... Income according to ordinary concepts (ordinary income).............. 17

6‑10....... Other assessable income (statutory income)..................................... 18

6‑15....... What is not assessable income.......................................................... 18

6‑20....... Exempt income................................................................................. 19

6‑23....... Non‑assessable non‑exempt income................................................. 20

6‑25....... Relationships among various rules about ordinary income.............. 20

Division 8—Deductions                                                                                             21

8‑1......... General deductions........................................................................... 21

8‑5......... Specific deductions........................................................................... 22

8‑10....... No double deductions....................................................................... 22

Part 1‑4—Checklists of what is covered by concepts used in the core provisions  23

Division 9—Entities that must pay income tax                                             23

9‑1A...... Effect of this Division...................................................................... 23

9‑1......... List of entities................................................................................... 23

9‑5......... Entities that work out their income tax by reference to something other than taxable income          24

Division 10—Particular kinds of assessable income                                 27

10‑1....... Effect of this Division...................................................................... 27

10‑5....... List of provisions about assessable income...................................... 27

Division 11—Particular kinds of non‑assessable income                        40

Subdivision 11‑A—Lists of classes of exempt income                                       40

11‑1A.... Effect of this Subdivision................................................................. 40

11‑1....... Overview.......................................................................................... 40

11‑5....... Entities that are exempt, no matter what kind of ordinary or statutory income they have               41

11‑10..... Ordinary or statutory income which is exempt, no matter whose it is 42

11‑15..... Ordinary or statutory income which is exempt only if it is derived by certain entities [see Note 7]                         43

Subdivision 11‑B—Particular kinds of non‑assessable non‑exempt income 48

11‑50..... Effect of this Subdivision................................................................. 48

11‑55..... List of non‑assessable non‑exempt income provisions.................... 48

Division 12—Particular kinds of deductions                                                  52

12‑1....... Effect of this Division...................................................................... 52

12‑5....... List of provisions about deductions [see Notes 2 and 8]................. 52

Division 13—Tax offsets                                                                                           68

13‑1A.... Effect of this Division...................................................................... 68

13‑1....... List of tax offsets.............................................................................. 68

Chapter 2—Liability rules of general application                                               74

Part 2‑1—Assessable income                                                                                         74

Division 15—Some items of assessable income                                          74

Guide to Division 15                                                                                                  74

15‑1....... What this Division is about.............................................................. 74

Operative provisions                                                                                                 75

15‑2....... Allowances and other things provided in respect of employment or services          75

15‑3....... Return to work payments................................................................ 75

15‑5....... Accrued leave transfer payments..................................................... 75

15‑10..... Bounties and subsidies..................................................................... 76

15‑15..... Profit‑making undertaking or plan.................................................... 76

15‑20..... Royalties........................................................................................... 76

15‑22..... Payments made to members of a copyright collecting society......... 76

15‑25..... Amount received for lease obligation to repair................................. 77

15‑30..... Insurance or indemnity for loss of assessable income...................... 77

15‑35..... Interest on overpayments and early payments of tax...................... 77

15‑40..... Providing mining, quarrying or prospecting information.................. 77

15‑45..... Amounts paid under forestry agreements........................................ 78

15‑50..... Work in progress amounts................................................................ 78

15‑55..... Certain amounts paid under funeral policy...................................... 78

15‑60..... Certain amounts paid under scholarship plan.................................. 79

15‑65..... Sugar industry exit grants................................................................. 79

15‑70..... Reimbursed car expenses.................................................................. 80

15‑75..... Bonuses............................................................................................ 80

Division 17—Effect of GST etc. on assessable income                            81

Guide to Division 17                                                                                                  81

17‑1....... What this Division is about.............................................................. 81

17‑5....... GST and increasing adjustments....................................................... 81

17‑10..... Certain decreasing adjustments......................................................... 81

17‑15..... Elements in calculation of amounts.................................................. 82

17‑20..... GST groups and GST joint ventures................................................ 82

17‑30..... Special credits because of indirect tax transition.............................. 82

17‑35..... Certain sections not to apply to certain assets or expenditure........ 83

Division 20—Amounts included to reverse the effect of past deductions             84

Guide to Division 20                                                                                                  84

20‑1....... What this Division is about.............................................................. 84

20‑5....... Other provisions that reverse the effect of deductions.................... 84

Subdivision 20‑A—Insurance, indemnity or other recoupment for deductible expenses    86

Guide to Subdivision 20‑A                                                                                        86

20‑10..... What this Subdivision is about......................................................... 86

20‑15..... How to use this Subdivision............................................................. 87

What is an assessable recoupment?                                                                      88

20‑20..... Assessable recoupments................................................................... 88

20‑25..... What is recoupment?........................................................................ 88

20‑30..... Tables of deductions for which recoupments are assessable............ 90

How much is included in your assessable income?                                             93

20‑35..... If the expense is deductible in a single income year.......................... 93

20‑40..... If the expense is deductible over 2 or more income years................ 94

20‑45..... Effect of balancing charge................................................................. 97

20‑50..... If the expense is only partially deductible........................................ 98

20‑55..... Meaning of previous recoupment law.............................................. 98

What if you can deduct a loss or outgoing incurred by another entity?          99

20‑60..... If you are the only entity that can deduct an amount for the loss or outgoing         99

20‑65..... If 2 or more entities can deduct amounts for the loss or outgoing.. 100

Subdivision 20‑B—Disposal of a car for which lease payments have been deducted            101

Guide to Subdivision 20‑B                                                                                      101

20‑100... What this Subdivision is about....................................................... 101

20‑105... Map of this Subdivision................................................................. 103

The usual case   103

20‑110... Disposal of a leased car for profit.................................................. 103

20‑115... Working out the profit on the disposal.......................................... 105

20‑120... Meaning of notional depreciation................................................... 106

The associate case                                                                                                   107

20‑125... Disposal of a leased car for profit.................................................. 107

Successive leases                                                                                                    109

20‑130... Successive leases............................................................................. 109

Previous disposals of the car                                                                                 109

20‑135... No amount included if earlier disposal for market value................ 109

20‑140... Reducing the amount to be included if there has been an earlier disposal                 109

Miscellaneous rules                                                                                                111

20‑145... No amount included if you inherited the car.................................. 111

20‑150... Reducing the amount to be included if another provision requires you to include an amount for the disposal          111

20‑155... Exception for particular cars taken on hire..................................... 111

20‑157... Exception for STS taxpayers.......................................................... 111

Disposals of interests in a car: special rules apply                                           112

20‑160... Disposal of an interest in a car....................................................... 112

Part 2‑5—Rules about deductibility of particular kinds of amounts      113

Division 25—Some amounts you can deduct                                               113

Guide to Division 25                                                                                                113

25‑1....... What this Division is about............................................................ 113

Operative provisions                                                                                               114

25‑5....... Tax‑related expenses....................................................................... 114

25‑7....... Advice about family tax benefit...................................................... 116

25‑10..... Repairs............................................................................................ 117

25‑15..... Amount paid for lease obligation to repair..................................... 117

25‑20..... Lease document expenses............................................................... 118

25‑25..... Borrowing expenses........................................................................ 118

25‑30..... Expenses of discharging a mortgage................................................ 121

25‑35..... Bad debts........................................................................................ 121

25‑40..... Loss from profit‑making undertaking or plan................................. 124

25‑45..... Loss by theft etc............................................................................. 125

25‑50..... Payments of pensions, gratuities or retiring allowances................. 125

25‑55..... Payments to associations............................................................... 126

25‑60..... Parliament election expenses.......................................................... 126

25‑65..... Local government election expenses............................................... 127

25‑70..... Deduction for election expenses does not extend to entertainment 128

25‑75..... Rates and land taxes on premises used to produce mutual receipts 128

25‑85..... Certain returns in respect of debt interests.................................... 129

25‑90..... Deduction relating to foreign non‑assessable non‑exempt income. 130

25‑95..... Deduction for work in progress amounts....................................... 131

25‑105... Deductions for United Medical Protection Limited support payments                   131

25‑100... Travel between workplaces............................................................ 132

25‑110... Capital expenditure to terminate lease etc...................................... 133

Division 26—Some amounts you cannot deduct, or cannot deduct in full              135

Guide to Division 26                                                                                                135

26‑1....... What this Division is about............................................................ 135

Operative provisions                                                                                               136

26‑5....... Penalties.......................................................................................... 136

26‑10..... Leave payments.............................................................................. 136

26‑15..... Franchise fees windfall tax.............................................................. 137

26‑17..... Commonwealth places windfall tax................................................ 137

26‑20..... Assistance to students.................................................................... 137

26‑25..... Interest or royalty.......................................................................... 138

26‑26..... Non‑share distributions and dividends........................................... 139

26‑30..... Relative’s travel expenses............................................................... 139

26‑35..... Reducing deductions for amounts paid to related entities.............. 141

26‑40..... Maintaining your family................................................................. 142

26‑45..... Recreational club expenses............................................................. 142

26‑50..... Expenses for a leisure facility or boat............................................. 143

26‑52..... Bribes to foreign public officials..................................................... 145

26‑53..... Bribes to public officials................................................................. 148

26‑54..... Expenditure relating to illegal activities.......................................... 149

26‑55..... Limit on deductions........................................................................ 149

26‑60..... Superannuation contributions surcharge......................................... 150

26‑65..... Termination payments surcharge................................................... 150

26‑68..... Loss from disposal of eligible venture capital investments............ 150

26‑70..... Loss from disposal of venture capital equity................................. 151

26‑75..... Contributions to non‑complying superannuation funds................ 152

26‑80..... Contributions to complying superannuation funds or RSAs......... 152

26‑85..... Amounts offset against superannuation guarantee charge.............. 153

26‑90..... Superannuation supervisory levy................................................... 154

26‑95..... Superannuation guarantee charge.................................................... 154

Division 27—Effect of input tax credits etc. on deductions                 155

Guide to Division 27                                                                                                155

27‑1....... What this Division is about............................................................ 155

Subdivision 27‑A—General                                                                                   155

27‑5....... Input tax credits and decreasing adjustments................................. 155

27‑10..... Certain increasing adjustments....................................................... 156

27‑15..... GST payments............................................................................... 156

27‑20..... Elements in calculation of amounts................................................ 157

27‑25..... GST groups and GST joint ventures.............................................. 157

27‑35..... Certain sections not to apply to certain assets or expenditure...... 157

Subdivision 27‑B—Effect of input tax credits etc. on capital allowances      158

27‑80..... Cost or opening adjustable value of depreciating assets reduced for input tax credits                       158

27‑85..... Cost or opening adjustable value of depreciating assets reduced: decreasing adjustments                 160

27‑87..... Certain decreasing adjustments included in assessable income....... 161

27‑90..... Cost or opening adjustable value of depreciating assets increased: increasing adjustments               161

27‑92..... Certain increasing adjustments can be deducted............................. 162

27‑95..... Balancing adjustment events........................................................... 162

27‑100... Pooling............................................................................................ 163

27‑105... Other Division 40 expenditure....................................................... 167

27‑110... Input tax credit etc. relating to 2 or more things............................. 168

Division 28—Car expenses                                                                                   169

Guide to Division 28                                                                                                169

28‑1....... What this Division is about............................................................ 169

28‑5....... Map of this Division...................................................................... 170

Subdivision 28‑A—Deductions for car expenses                                              170

28‑10..... Application of Division 28............................................................. 171

28‑12..... Car expenses................................................................................... 171

28‑13..... Meaning of car expense.................................................................. 171

Subdivision 28‑B—Choosing which method to use                                           172

Guide to Subdivision 28‑B                                                                                      172

28‑14..... What this Subdivision is about....................................................... 172

28‑15..... Choosing among the 4 methods...................................................... 172

Operative provision                                                                                                 174

28‑20..... Rules governing choice of method.................................................. 174

Subdivision 28‑C—The “cents per kilometre” method                                   174

28‑25..... How to calculate your deduction.................................................... 174

28‑30..... Capital allowances.......................................................................... 175

28‑35..... Substantiation................................................................................. 175

Subdivision 28‑D—The “12% of original value” method                               175

28‑45..... How to calculate your deduction.................................................... 175

28‑50..... Eligibility........................................................................................ 176

28‑55..... Capital allowances.......................................................................... 176

28‑60..... Substantiation................................................................................. 177

Subdivision 28‑E—The “one‑third of actual expenses” method                     177

28‑70..... How to calculate your deduction.................................................... 177

28‑75..... Eligibility........................................................................................ 177

28‑80..... Substantiation................................................................................. 178

Subdivision 28‑F—The “log book” method                                                        178

28‑90..... How to calculate your deduction.................................................... 178

28‑95..... Eligibility........................................................................................ 180

28‑100... Substantiation................................................................................. 180

Subdivision 28‑G—Keeping a log book                                                               181

Guide to Subdivision 28‑G                                                                                      181

28‑105... What this Subdivision is about....................................................... 181

28‑110... Steps for keeping a log book........................................................... 181

Operative provisions                                                                                               181

28‑115... Income years for which you need to keep a log book.................... 181

28‑120... Choosing the 12 week period for a log book.................................. 182

28‑125... How to keep a log book.................................................................. 183

28‑130... Replacing one car with another....................................................... 184

Subdivision 28‑H—Odometer records for a period                                           184

Guide to Subdivision 28‑H                                                                                      184

28‑135... What this Subdivision is about....................................................... 184

Operative provision                                                                                                 185

28‑140... How to keep odometer records for a car for a period..................... 185

Subdivision 28‑I—Retaining the log book and odometer records                  185

28‑150... Retaining the log book for the retention period.............................. 185

28‑155... Retaining odometer records............................................................ 186

Subdivision 28‑J—Situations where you cannot use, or don’t need to use, one of the 4 methods               187

Guide to Subdivision 28‑J                                                                                      187

28‑160... What this Subdivision is about....................................................... 187

Operative provisions                                                                                               188

28‑165... Exception for particular cars taken on hire..................................... 188

28‑170... Exception for particular cars used in particular ways.................... 188

28‑175... Further miscellaneous exceptions................................................... 190

28‑180... Car expenses related to award transport payments....................... 191

28‑185... Application of Subdivision 28‑J to recipients and payers of certain withholding payments            191

Division 30—Gifts or contributions                                                                  193

Guide to Division 30                                                                                                193

30‑1....... What this Division is about............................................................ 193

30‑5....... How to find your way around this Division.................................. 194

30‑10..... Index............................................................................................... 195

Subdivision 30‑A—Deductions for gifts or contributions                               195

30‑15..... Table of gifts or contributions that you can deduct....................... 195

30‑17..... Requirements for certain recipients................................................ 208

Subdivision 30‑B—Tables of recipients for deductible gifts                           209

Health                                                                                                                         210

30‑20..... Health............................................................................................. 210

Education                                                                                                                   213

30‑25..... Education........................................................................................ 213

30‑30..... Gifts that must be for certain purposes......................................... 217

30‑35..... Gifts to a public fund established to benefit a rural school hostel building must satisfy certain requirements           217

30‑37..... Scholarship etc. funds..................................................................... 218

Research                                                                                                                   218

30‑40..... Research.......................................................................................... 218

Welfare and rights                                                                                                  219

30‑45..... Welfare and rights........................................................................... 219

30‑46..... Australian disaster relief funds....................................................... 222

Defence                                                                                                                      223

30‑50..... Defence........................................................................................... 223

Environment                                                                                                              225

30‑55..... The environment............................................................................. 225

30‑60..... Gifts to a National Parks body or conservation body must satisfy certain requirements                 227

Industry, trade and design                                                                                      227

30‑65..... Industry, trade and design.............................................................. 227

The family                                                                                                                 228

30‑70..... The family...................................................................................... 228

30‑75..... Marriage education organisations must be approved..................... 229

International affairs                                                                                                229

30‑80..... International affairs......................................................................... 229

30‑85..... Developing country relief funds..................................................... 231

30‑86..... Developed country disaster relief funds......................................... 232

Sports and recreation                                                                                             233

30‑90..... Sports and recreation...................................................................... 233

Philanthropic trusts                                                                                                233

30‑95..... Philanthropic trusts........................................................................ 233

Cultural organisations                                                                                           234

30‑100... Cultural organisations..................................................................... 234

Fire and emergency services                                                                                 235

30‑102... Fire and emergency services........................................................... 235

Other recipients                                                                                                      236

30‑105... Other recipients.............................................................................. 236

Subdivision 30‑BA—Endorsement of deductible gift recipients                    237

Guide to Subdivision 30‑BA                                                                                   237

30‑115... What this Subdivision is about....................................................... 237

Endorsement as a deductible gift recipient                                                         238

30‑120... Endorsement by Commissioner...................................................... 238

30‑125... Entitlement to endorsement............................................................ 238

30‑130... Maintaining a gift fund................................................................... 240

Government entities treated like entities                                                           241

30‑180... How this Subdivision applies to government entities.................... 241

Subdivision 30‑C—Rules applying to particular gifts of property                 241

Valuation requirements                                                                                         241

30‑200... Getting written valuations.............................................................. 241

30‑205... Proceeds of the sale would have been assessable........................... 242

30‑210... Approved valuers........................................................................... 242

30‑212... Valuations by the Commissioner.................................................... 243

Working out the amount you can deduct for a gift of property                       243

30‑215... How much you can deduct............................................................. 243

30‑220... Reducing the amount you can deduct............................................. 245

Joint ownership of property                                                                                   245

30‑225... Gift of property by joint owners................................................... 245

Subdivision 30‑CA—Administrative requirements relating to ABNs          246

Guide to Subdivision 30‑CA                                                                                   246

30‑226... What this Subdivision is about....................................................... 246

Requirements    246

30‑227... Entities to which this Subdivision applies..................................... 246

30‑228... Content of receipt for gift or contribution...................................... 247

30‑229... Australian Business Register must show deductibility of gifts to deductible gift recipient               248

Subdivision 30‑D—Testamentary gifts under the Cultural Bequests Program                   249

30‑230... Testamentary gifts of property...................................................... 249

30‑235... Getting a certificate......................................................................... 251

30‑240... Limit on total value of gifts for an income year.............................. 251

Subdivision 30‑DA—Donations to political parties and independent candidates and members                  251

Guide to Subdivision 30‑DA                                                                                   251

30‑241... What this Subdivision is about....................................................... 251

Operative provisions                                                                                               252

30‑242... Deduction for political contributions and gifts............................... 252

30‑243... Amount of the deduction................................................................ 253

30‑244... When an individual is an independent candidate............................ 253

30‑245... When an individual is an independent member............................... 254

Subdivision 30‑DB—Spreading certain gift and covenant deductions over up to 5 income years              255

Guide to Subdivision 30‑DB                                                                                   255

30‑246... What this Subdivision is about....................................................... 255

Operative provisions                                                                                               255

30‑247... Gifts and covenants for which elections can be made.................... 255

30‑248... Making an election.......................................................................... 256

30‑249... Effect of election............................................................................. 257

30‑249A Requirements—environmental property gifts................................ 257

30‑249B Requirements—heritage property gifts.......................................... 257

30‑249C Requirements—certain cultural property gifts............................... 258

30‑249D Requirements—conservation covenants......................................... 258

Subdivision 30‑E—Register of environmental organisations                         258

Guide to Subdivision 30‑E                                                                                      258

30‑250... What this Subdivision is about....................................................... 258

Operative provisions                                                                                               259

30‑255... Establishing the register.................................................................. 259

30‑260... Meaning of environmental organisation........................................ 259

30‑265... Its principal purpose must be protecting the environment............ 259

30‑270... Other requirements it must satisfy................................................. 260

30‑275... Further requirement for a body corporate or a co‑operative society 261

30‑280... What must be on the register.......................................................... 261

30‑285... Removal from the register............................................................... 262

Subdivision 30‑EA—Register of harm prevention charities                           262

Guide to Subdivision 30‑EA                                                                                   262

30‑286... What this Subdivision is about....................................................... 262

Operative provisions                                                                                               262

30‑287... Establishing the register.................................................................. 262

30‑288... Meaning of harm prevention charity.............................................. 263

30‑289... Principal activity—promoting the prevention or control of harm or abuse              263

30‑289A Other requirements......................................................................... 263

30‑289B What must be on the register.......................................................... 264

30‑289C Removal from the register............................................................... 264

Subdivision 30‑F—Register of cultural organisations                                    265

Guide to Subdivision 30‑F                                                                                      265

30‑290... What this Subdivision is about....................................................... 265

Operative provisions                                                                                               265

30‑295... Establishing the register.................................................................. 265

30‑300... Meaning of cultural organisation................................................... 265

30‑305... What must be on the register.......................................................... 266

30‑310... Removal from the register............................................................... 267

Subdivision 30‑G—Index to this Division                                                           267

30‑315... Index............................................................................................... 267

30‑320... Effect of this Subdivision............................................................... 277

Division 31—Conservation covenants                                                            278

Guide to Division 31                                                                                                278

31‑1....... What this Division is about............................................................ 278

Operative provisions                                                                                               278

31‑5....... Deduction for entering into conservation covenant........................ 278

31‑10..... Requirements for fund, authority or institution............................. 280

31‑15..... Valuations by the Commissioner.................................................... 280

Division 32—Entertainment expenses                                                           281

Guide to Division 32                                                                                                281

32‑1....... What this Division is about............................................................ 281

Subdivision 32‑A—No deduction for entertainment expenses                        281

32‑5....... No deduction for entertainment expenses...................................... 281

32‑10..... Meaning of entertainment............................................................... 282

32‑15..... No deduction for property used for providing entertainment........ 282

Subdivision 32‑B—Exceptions                                                                              282

32‑20..... The main exception—fringe benefits.............................................. 283

32‑25..... The tables set out the other exceptions.......................................... 283

32‑30..... Employer expenses......................................................................... 283

32‑35..... Seminar expenses............................................................................ 286

32‑40..... Entertainment industry expenses................................................... 286

32‑45..... Promotion and advertising expenses............................................... 287

32‑50..... Other expenses............................................................................... 287

Subdivision 32‑C—Definitions relevant to the exceptions                              288

32‑55..... In‑house dining facility (employer expenses table items 1.1 and 1.2) 288

32‑60..... Dining facility (employer expenses table item 1.3)........................ 288

32‑65..... Seminars (seminar expenses table item 2.1).................................... 289

Subdivision 32‑D—In‑house dining facilities (employer expenses table item 1.2)               290

32‑70..... $30 is assessable for each meal provided to non‑employee in an in‑house dining facility                 290

Subdivision 32‑E—Anti‑avoidance                                                                       291

32‑75..... Commissioner may treat you as having incurred entertainment expense                  291

Subdivision 32‑F—Special rules for companies and partnerships                291

32‑80..... Company directors......................................................................... 292

32‑85..... Directors, employees and property of wholly‑owned group company                   292

32‑90..... Partnerships.................................................................................... 293

Division 34—Non‑compulsory uniforms                                                         294

Guide to Division 34                                                                                                294

34‑1....... What this Division is about............................................................ 294

34‑3....... What you need to read.................................................................... 294

Subdivision 34‑A—Application of Division 34                                                   295

34‑5....... This Division applies to employees and others............................. 295

34‑7....... This Division applies to employers and others............................. 296

Subdivision 34‑B—Deduction for your non‑compulsory uniform                  296

34‑10..... What you can deduct...................................................................... 296

34‑15..... What is a non‑compulsory uniform?............................................... 297

34‑20..... What are occupation specific clothing and protective clothing?...... 297

Subdivision 34‑C—Registering the design of a non‑compulsory uniform   298

34‑25..... Application to register the design................................................... 298

34‑30..... Industry Secretary’s decision on application................................. 299

34‑33..... Written notice of decision............................................................... 300

34‑35..... When uniform becomes registered.................................................. 301

Subdivision 34‑D—Appeals from Industry Secretary’s decision                   301

34‑40..... Review of decisions by the Administrative Appeals Tribunal...... 301

Subdivision 34‑E—The Register of Approved Occupational Clothing          301

34‑45..... Keeping of the Register.................................................................. 301

34‑50..... Changes to the Register.................................................................. 302

Subdivision 34‑F—Approved occupational clothing guidelines                      302

34‑55..... Approved occupational clothing guidelines.................................... 302

Subdivision 34‑G—The Industry Secretary                                                       303

34‑60..... Industry Secretary to give Commissioner information about entries 303

34‑65..... Delegation of powers by Industry Secretary................................. 303

Division 35—Deferral of losses from non‑commercial business activities           304

Guide to Division 35                                                                                                304

35‑1....... What this Division is about............................................................ 304

Operative provisions                                                                                               305

35‑5....... Object............................................................................................. 305

35‑10..... Deferral of deductions from non‑commercial business activities... 305

35‑15..... Modification if you have exempt income....................................... 308

35‑20..... Modification if you become bankrupt............................................ 308

35‑25..... Application of Division to certain partnerships............................ 309

35‑30..... Assessable income test................................................................... 309

35‑35..... Profits test...................................................................................... 309

35‑40..... Real property test.......................................................................... 310

35‑45..... Other assets test............................................................................. 311

35‑50..... Apportionment............................................................................... 312

35‑55..... Commissioner’s discretion............................................................. 312

Division 36—Tax losses of earlier income years                                      314

Guide to Division 36                                                                                                314

36‑1....... What this Division is about............................................................ 314

Subdivision 36‑A—Deductions for tax losses of earlier income years         314

36‑10..... How to calculate a tax loss for an income year............................... 314

36‑15..... How to deduct tax losses of entities other than corporate tax entities 315

36‑17..... How to deduct tax losses of corporate tax entities......................... 316

36‑20..... Net exempt income......................................................................... 319

36‑25..... Special rules about tax losses.......................................................... 320

Subdivision 36‑B—Effect of you becoming bankrupt                                       324

Guide to Subdivision 36‑B                                                                                      324

36‑30..... What this Subdivision is about....................................................... 324

Operative provisions                                                                                               325

36‑35..... No deduction for tax loss incurred before bankruptcy................... 325

36‑40..... Deduction for amounts paid for debts incurred before bankruptcy 326

36‑45..... Limit on deductions for amounts paid............................................ 326

Subdivision 36‑C—Excess franking offsets                                                       327

Guide to Subdivision 36‑C                                                                                      327

36‑50..... What this Subdivision is about....................................................... 327

Operative provision                                                                                                 328

36‑55..... Converting excess franking offsets into tax loss............................. 328

An Act about income tax and related matters

Chapter 1—Introduction and core provisions

Part 1‑1—Preliminary

Division 1—Preliminary

Table of sections

1‑1            Short title

1‑2            Commencement

1‑3            Differences in style not to affect meaning

1‑1  Short title [see Note 1]

                   This Act may be cited as the Income Tax Assessment Act 1997.

1‑2  Commencement

                   This Act commences on 1 July 1997.

1‑3  Differences in style not to affect meaning

             (1)  This Act contains provisions of the Income Tax Assessment Act 1936 in a rewritten form.

             (2)  If:

                     (a)  that Act expressed an idea in a particular form of words; and

                     (b)  this Act appears to have expressed the same idea in a different form of words in order to use a clearer or simpler style;

the ideas are not to be taken to be different just because different forms of words were used.

Note:          A public or private ruling about a provision of the Income Tax Assessment Act 1936 is taken also to be a ruling about the corresponding provision of this Act, so far as the 2 provisions express the same ideas: see section 357‑85 in Schedule 1 to the Taxation Administration Act 1953.

 

Part 1‑2—A Guide to this Act

Division 2—How to use this Act

Table of Subdivisions

2‑A        How to find your way around

2‑B        How the Act is arranged

2‑C        How to identify defined terms and find the definitions

2‑D        The numbering system

2‑E        Status of Guides and other non‑operative material

Subdivision 2‑A—How to find your way around

2‑1  The design

                   This Act is designed to help you identify accurately and quickly the provisions that are relevant to your purpose in reading the income tax law.

                   The Act contains tables, diagrams and signposts to help you navigate your way.

                   You can start at Division 3 (What this Act is about) and follow the signposts as far into the Act as you need to go. You may also encounter signposts to several areas of the law that are relevant to you. Each one should be followed.

                   Sometimes they will lead down through several levels of detail. At each successive level, the rules are structured in a similar way. They will often be preceded by a Guide to the rules at that level. The rules themselves will usually deal first with the general or most common case and then with the more particular or special cases.

Subdivision 2‑B—How the Act is arranged

2‑5  The pyramid

                   This Act is arranged in a way that reflects the principle of moving from the general case to the particular.

                   In this respect, the conceptual structure of the Act is something like a pyramid. The pyramid shape illustrates the way the income tax law is organised, moving down from the central or core provisions at the top of the pyramid, to general rules of wide application and then to the more specialised topics.

 

 

Note:          The Taxation Administration Act 1953 contains the provisions on collection and recovery of tax and provisions on administration.

Subdivision 2‑C—How to identify defined terms and find the definitions

Table of sections

2‑10          When defined terms are identified

2‑15          When terms are not identified

2‑20          Identifying the defined term in a definition

2‑10  When defined terms are identified

             (1)  Many of the terms used in the income tax law are defined.

             (2)  Most defined terms in this Act are identified by an asterisk appearing at the start of the term: as in “*business”. The footnote that goes with the asterisk contains a signpost to the Dictionary definitions starting at section 995‑1.

2‑15  When terms are not identified

             (1)  Once a defined term has been identified by an asterisk, later occurrences of the term in the same subsection are not usually asterisked.

             (2)  Terms are not asterisked in the non‑operative material contained in this Act.

Note:          The non‑operative material is described in Subdivision 2‑E.

             (3)  The following basic terms used throughout the Act are not identified with an asterisk. They fall into 2 groups:

Key participants in the income tax system

 

Item	This term:	is defined in:
1.	Australian resident	section 995‑1
2.	Commissioner	section 995‑1
3.	company	section 995‑1
4.	entity	section 960‑100
4A.	foreign resident	section 995‑1
5.	individual	section 995‑1
6.	partnership	section 995‑1
7.	person	section 995‑1
8.	trustee	section 995‑1
9.	you	section 4‑5

Core concepts

 

Item	This term:	is defined in:
1.	amount	section 995‑1
2.	assessable income	Division 6
3.	assessment	section 995‑1
4.	deduct, deduction	Division 8
5.	income tax	section 995‑1
6.	income year	section 995‑1
7.	taxable income	section 4‑15
8.	this Act	section 995‑1

2‑20  Identifying the defined term in a definition

                   Within a definition, the defined term is identified by bold italics.

Subdivision 2‑D—The numbering system

Table of sections

2‑25          Purposes

2‑30          Gaps in the numbering

2‑25  Purposes

                   Two main purposes of the numbering system in this Act are:

·         To indicate the relationship between units at different levels.

                   For example, the number of Part 2‑15 indicates that the Part is in Chapter 2. Similarly, the number of section 165‑70 indicates that the section is in Division 165.

·         To allow for future expansion of the Act. The main technique here is leaving gaps between numbers.

2‑30  Gaps in the numbering

                   There are gaps in the numbering system to allow for the insertion of new Divisions and sections.

Subdivision 2‑E—Status of Guides and other non‑operative material

Table of sections

2‑35          Non‑operative material

2‑40          Guides

2‑45          Other material

2‑35  Non‑operative material

                   In addition to the operative provisions themselves, this Act contains other material to help you identify accurately and quickly the provisions that are relevant to you and to help you understand them.

                   This other material falls into 2 main categories.

2‑40  Guides

                   The first is the “Guides”. A Guide consists of sections under a heading indicating that what follows is a Guide to a particular Subdivision, Division etc.

                   Guides form part of this Act but are kept separate from the operative provisions. In interpreting an operative provision, a Guide may only be considered for limited purposes. These are set out in section 950‑150.

2‑45  Other material

                   The other category consists of material such as notes and examples. These also form part of the Act. They are distinguished by type size from the operative provisions, but are not kept separate from them.

 

Division 3—What this Act is about

Table of sections

3‑1            What this Act is about

3‑5            Annual income tax

3‑10          Your other obligations as a taxpayer

3‑15          Your obligations other than as a taxpayer

3‑1  What this Act is about

                   This Act is mainly about income tax, and this Division is concerned only with income tax.

                   However, this Act also deals with a variety of other topics that may affect you:

 

Item	For a guide to this topic:	See:
1.	Medicare levy	Division 785

3‑5  Annual income tax

             (1)  Income tax is payable for each year by each individual and company, and by some other entities.

Note 1:       Individuals who are Australian residents, and some trustees, are also liable to pay Medicare levy for each year. See Division 785.

Note 2:       Income tax is imposed by the Income Tax Act 1986 and the other Acts referred to in the definition of income tax in section 995‑1.

             (2)  Most entities have to pay instalments of income tax before the income tax they actually have to pay can be worked out.

             (3)  This Act answers these questions:

                       1.  What instalments of income tax do you have to pay? When and how do you pay them?

See Schedule 1 to the Taxation Administration Act 1953.

                       2.  How do you work out how much income tax you must pay?

See Division 4, starting at section 4‑1.

                       3.  What happens if your income tax is more than the instalments you have paid? When and how must you pay the rest?

                   See sections 204, 213 and 219 of the Income Tax Assessment Act 1936 and Part 4‑15 in Schedule 1 to the Taxation Administration Act 1953.

                       4.  What happens if your income tax is less than the instalments you have paid? How do you get a refund?

See Division 3A of Part IIB of the Taxation Administration Act 1953.

                       5.  What are your other obligations as a taxpayer, besides paying instalments and the rest of your income tax?

                   See section 3‑10.

                       6.  Do you have any other obligations under the income tax law?

                   See section 3‑15.

                       7.  If a dispute between you and the Commissioner of Taxation cannot be settled by agreement, what procedures for objection, review and appeal are available?

                   See Part IVC (sections 14ZL to 14ZZS) of the Taxation Administration Act 1953.

3‑10  Your other obligations as a taxpayer

             (1)  Besides paying instalments and the rest of your income tax, your main obligations as a taxpayer are:

                     (a)  to keep records and provide information as required by:

·         the Income Tax Assessment Act 1936; and

·         Division 900 (which sets out substantiation rules) of this Act; and

                     (b)  to lodge returns as required by:

·           the Income Tax Assessment Act 1936.

Tax file numbers

             (2)  Under Part VA of the Income Tax Assessment Act 1936, a tax file number can be issued to you. You are not obliged to apply for a tax file number. However, if you do not quote one in certain situations:

·         you may become liable for instalments of income tax that would not otherwise have been payable;

·         the amount of certain of your instalments of income tax may be increased.

3‑15  Your obligations other than as a taxpayer

                   Your main obligations under the income tax law, other than as a taxpayer are:

·         in certain situations, to deduct from money you owe to another person, and to remit to the Commissioner, instalments of income tax payable by that person.

See Part 4‑5 (Collection of income tax instalments),
starting at section 750‑1.

 

Part 1‑3—Core provisions

Division 4—How to work out the income tax payable on your taxable income

Table of sections

4‑1            Who must pay income tax

4‑5            Meaning of you

4‑10          How to work out how much income tax you must pay

4‑15          How to work out your taxable income

4‑25          Special provisions for working out your basic income tax liability

4‑1  Who must pay income tax

                   Income tax is payable by each individual and company, and by some other entities.

Note:          The actual amount of income tax payable may be nil.

For a list of the entities that must pay income tax,
see Division 9, starting at section 9‑1.

4‑5  Meaning of you

                   If a provision of this Act uses the expression you, it applies to entities generally, unless its application is expressly limited.

Note 1:       The expression you is not used in provisions that apply only to entities that are not individuals.

Note 2:       For circumstances in which the identity of an entity that is a managed investment scheme for the purposes of the Corporations Act 2001 is not affected by changes to the scheme, see Subdivision 960‑E of the Income Tax (Transitional Provisions) Act 1997.

4‑10  How to work out how much income tax you must pay

             (1)  You must pay income tax for each year ending on 30 June, called the financial year.

             (2)  Your income tax is worked out by reference to your taxable income for the income year. The income year is the same as the *financial year, except in these cases:

                     (a)  for a company, the income year is the previous financial year;

                     (b)  if you have an accounting period that is not the same as the financial year, each such accounting period or, for a company, each previous accounting period is an income year.

Note 1:       The Commissioner can allow you to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936.

Note 2:       An accounting period ends, and a new accounting period starts, when a partnership becomes, or ceases to be, a VCLP, an AFOF or a VCMP. See section 18A of the Income Tax Assessment Act 1936.

             (3)  Work out your income tax for the *financial year as follows:

Note:          Division 63 explains what happens if your tax offsets exceed your basic income tax liability. How the excess is treated depends on the type of tax offset.

Income tax worked out on another basis

             (4)  For some entities, some or all of their income tax for the *financial year is worked out by reference to something other than taxable income for the income year.

See section 9‑5.

4‑15  How to work out your taxable income

             (1)  Work out your taxable income for the income year like this:

Note:          If the deductions exceed the assessable income, you may have a tax loss which you may be able to deduct in a later income year: see Division 36.

             (2)  There are cases where taxable income is worked out in a special way:

 

Item	For this case ...	See:
1.	A company does not maintain continuity of ownership and control during the income year and does not satisfy the same business test	Subdivision 165‑B
1A.	An entity becomes an *STS taxpayer for an income year	Division 328
1B.	An entity is a *member of a *consolidated group at any time in the income year	Part 3‑90
2.	A company becomes a PDF (pooled development fund) during the income year, and the PDF component for the income year is a nil amount	section 124ZTA of the Income Tax Assessment Act 1936
3.	A shipowner or charterer:     has its principal place of business outside Australia; and     carries passengers, freight or mail shipped in Australia	section 129 of the Income Tax Assessment Act 1936
4.	An insurer who is a foreign resident enters into insurance contracts connected with Australia	sections 142 and 143 of the Income Tax Assessment Act 1936
5.	The Commissioner makes a default or special assessment of taxable income	sections 167 and 168 of the Income Tax Assessment Act 1936

Note:          A life insurance company can have a taxable income of the complying superannuation class and/or a taxable income of the ordinary class for the purposes of working out its income tax for an income year: see Subdivision 320‑D.

4‑25  Special provisions for working out your basic income tax liability

                   Subsection 392‑35(3) may increase your basic income tax liability beyond the liability worked out simply by applying the income tax rates to your taxable income.

Note:          Subsection 392‑35(3) increases some primary producers’ tax liability by requiring them to pay extra income tax on their averaging components worked out under Subdivision 392‑C.

 

Division 6—Assessable income and exempt income

Guide to Division 6

Table of sections

6‑1            Diagram showing relationships among concepts in this Division

Operative provisions

6‑5            Income according to ordinary concepts (ordinary income)

6‑10          Other assessable income (statutory income)

6‑15          What is not assessable income

6‑20          Exempt income

6‑23          Non‑assessable non‑exempt income

6‑25          Relationships among various rules about ordinary income

6‑1  Diagram showing relationships among concepts in this Division

             (1)  Assessable income consists of ordinary income and statutory income.

             (2)  Some ordinary income, and some statutory income, is exempt income.

             (3)  Exempt income is not assessable income.

             (4)  Some ordinary income, and some statutory income, is neither assessable income nor exempt income.

For the effect of the GST in working out assessable income, see Division 17.

             (5)  An amount of ordinary income or statutory income can have only one status (that is, assessable income, exempt income or non‑assessable non‑exempt income) in the hands of a particular entity.

Operative provisions

6‑5  Income according to ordinary concepts (ordinary income)

             (1)  Your assessable income includes income according to ordinary concepts, which is called ordinary income.

Note:          Some of the provisions about assessable income listed in section 10‑5 may affect the treatment of ordinary income.

             (2)  If you are an Australian resident, your assessable income includes the *ordinary income you *derived directly or indirectly from all sources, whether in or out of Australia, during the income year.

             (3)  If you are a foreign resident, your assessable income includes:

                     (a)  the *ordinary income you *derived directly or indirectly from all *Australian sources during the income year; and

                     (b)  other *ordinary income that a provision includes in your assessable income for the income year on some basis other than having an *Australian source.

             (4)  In working out whether you have derived an amount of *ordinary income, and (if so) when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct.

6‑10  Other assessable income (statutory income)

             (1)  Your assessable income also includes some amounts that are not *ordinary income.

Note:          These are included by provisions about assessable income.
For a summary list of these provisions, see section 10‑5.

             (2)  Amounts that are not *ordinary income, but are included in your assessable income by provisions about assessable income, are called statutory income.

Note 1:       Although an amount is statutory income because it has been included in assessable income under a provision of this Act, it may be made exempt income or non‑assessable non‑exempt income under another provision: see sections 6‑20 and 6‑23.

Note 2:       Many provisions in the summary list in section 10‑5 contain rules about ordinary income. These rules do not change its character as ordinary income.

             (3)  If an amount would be *statutory income apart from the fact that you have not received it, it becomes statutory income as soon as it is applied or dealt with in any way on your behalf or as you direct.

             (4)  If you are an Australian resident, your assessable income includes your *statutory income from all sources, whether in or out of Australia.

             (5)  If you are a foreign resident, your assessable income includes:

                     (a)  your *statutory income from all *Australian sources; and

                     (b)  other *statutory income that a provision includes in your assessable income on some basis other than having an *Australian source.

6‑15  What is not assessable income

             (1)  If an amount is not *ordinary income, and is not *statutory income, it is not assessable income (so you do not have to pay income tax on it).

             (2)  If an amount is *exempt income, it is not assessable income.

Note:          If an amount is exempt income, there are other consequences besides it being exempt from income tax. For example:

·         the amount may be taken into account in working out the amount of a tax loss (see section 36‑10);

·         you cannot deduct as a general deduction a loss or outgoing incurred in deriving the amount (see Division 8);

·         capital gains and losses on assets used solely to produce exempt income are disregarded (see section 118‑12).

             (3)  If an amount is *non‑assessable non‑exempt income, it is not assessable income.

Note 1:       You cannot deduct as a general deduction a loss or outgoing incurred in deriving an amount of non‑assessable non‑exempt income (see Division 8).

Note 2:       Capital gains and losses on assets used to produce some types of non‑assessable non‑exempt income are disregarded (see section 118‑12).

6‑20  Exempt income

             (1)  An amount of *ordinary income or *statutory income is exempt income if it is made exempt from income tax by a provision of this Act or another *Commonwealth law.

For summary lists of provisions about exempt income,
see sections 11‑5, 11‑10 and 11‑15.

             (2)  *Ordinary income is also exempt income to the extent that this Act excludes it (expressly or by implication) from being assessable income.

             (3)  By contrast, an amount of *statutory income is exempt income only if it is made exempt from income tax by a provision of this Act outside this Division or another *Commonwealth law.

             (4)  If an amount of *ordinary income or *statutory income is *non‑assessable non‑exempt income, it is not exempt income.

Note:          An amount of non‑assessable non‑exempt income is not taken into account in working out the amount of a tax loss.

6‑23  Non‑assessable non‑exempt income

                   An amount of *ordinary income or *statutory income is non‑assessable non‑exempt income if a provision of this Act or of another *Commonwealth law states that it is not assessable income and is not *exempt income.

Note:          Capital gains and losses on assets used to produce some types of non‑assessable non‑exempt income are disregarded (see section 118‑12).

For a summary list of provisions about non‑assessable non‑exempt income, see Subdivision 11‑B.

6‑25  Relationships among various rules about ordinary income

             (1)  Sometimes more than one rule includes an amount in your assessable income:

·         the same amount may be *ordinary income and may also be included in your assessable income by one or more provisions about assessable income; or

·         the same amount may be included in your assessable income by more than one provision about assessable income.

For a summary list of the provisions about assessable income,
 see section 10‑5.

However, the amount is included only once in your assessable income for an income year, and is then not included in your assessable income for any other income year.

             (2)  Unless the contrary intention appears, the provisions of this Act (outside this Part) prevail over the rules about *ordinary income.

Note:          This Act contains some specific provisions about how far the rules about ordinary income prevail over the other provisions of this Act.

 

Division 8—Deductions

Table of sections

8‑1            General deductions

8‑5            Specific deductions

8‑10          No double deductions

8‑1  General deductions

             (1)  You can deduct from your assessable income any loss or outgoing to the extent that:

                     (a)  it is incurred in gaining or producing your assessable income; or

                     (b)  it is necessarily incurred in carrying on a *business for the purpose of gaining or producing your assessable income.

Note:          Division 35 prevents losses from non‑commercial business activities that may contribute to a tax loss being offset against other assessable income.

             (2)  However, you cannot deduct a loss or outgoing under this section to the extent that:

                     (a)  it is a loss or outgoing of capital, or of a capital nature; or

                     (b)  it is a loss or outgoing of a private or domestic nature; or

                     (c)  it is incurred in relation to gaining or producing your *exempt income or your *non‑assessable non‑exempt income; or

                     (d)  a provision of this Act prevents you from deducting it.

For a summary list of provisions about deductions, see section 12‑5.

             (3)  A loss or outgoing that you can deduct under this section is called a general deduction.

For the effect of the GST in working out deductions, see Division 27.

Note           If you receive an amount as insurance, indemnity or other recoupment of a loss or outgoing that you can deduct under this section, the amount may be included in your assessable income: see Subdivision 20‑A.

8‑5  Specific deductions

             (1)  You can also deduct from your assessable income an amount that a provision of this Act (outside this Division) allows you to deduct.

             (2)  Some provisions of this Act prevent you from deducting an amount that you could otherwise deduct, or limit the amount you can deduct.

             (3)  An amount that you can deduct under a provision of this Act (outside this Division) is called a specific deduction.

Note:          If you receive an amount as insurance, indemnity or other recoupment of a deductible expense, the amount may be included in your assessable income: see Subdivision 20‑A.

For a summary list of provisions about deductions, see section 12‑5.

8‑10  No double deductions

                   If 2 or more provisions of this Act allow you deductions in respect of the same amount (whether for the same income year or different income years), you can deduct only under the provision that is most appropriate.

 

Part 1‑4—Checklists of what is covered by concepts used in the core provisions

Division 9—Entities that must pay income tax

Table of sections

9‑1A         Effect of this Division

9‑1            List of entities

9‑5            Entities that work out their income tax by reference to something other than taxable income

9‑1A  Effect of this Division

                   This Division is a *Guide.

9‑1  List of entities

                   Income tax is payable by the entities listed in the table.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

Item	Income tax is payable by this kind of entity:	because of this provision:
1.	An individual	section 4‑1
2.	A company, that is:     a body corporate; or     an unincorporated body (except a partnership)	section 4‑1
2A	A company that was a member of a wholly‑owned group if a former subsidiary in the group is treated as having disposed of leased plant and does not pay all of the income tax resulting from that treatment	section 45‑25
3.	A corporate limited partnership	section 94J
4.	A mutual insurance association (as described in section 121)	section 121
5.	A trustee (except one covered by a later item in this table), but only in respect of some kinds of income of the trust	sections 98, 99, 99A and 102
6.	The trustee of a corporate unit trust	section 102K
7.	The trustee of a public trading trust	section 102S
8.	The trustee of a complying superannuation fund	section 278
9.	The trustee of a non‑complying superannuation fund	section 286
10.	The trustee of a complying approved deposit fund	section 289
11.	The trustee of a non‑complying approved deposit fund	section 294
12.	The trustee of a pooled superannuation trust	section 296

9‑5  Entities that work out their income tax by reference to something other than taxable income

             (1)  For some entities, some or all of their income tax for the *financial year is worked out as described in the table.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

Item	This kind of entity is liable to pay income tax worked out by reference to:	See:
1AA	A company that was a member of a wholly‑owned group is jointly and severally liable to pay an amount of income tax if a former subsidiary in the group is treated as having disposed of leased plant and does not pay all of the income tax resulting from that treatment.	section 45‑25
1A	An Australian resident individual with:     eligible foreign remuneration under section 23AF; or     foreign earnings under section 23AG; (from working in a foreign country) is liable to pay income tax worked out by reference to his or her assessable income less some of his or her deductions.	section 23AF or 23AG
1.	A trustee covered by item 5 in the table in section 9‑1 is liable to pay income tax worked out by reference to the net income of the trust for the income year.	sections 98, 99 and 99A
2.	The trustee of a corporate unit trust is liable to pay income tax worked out by reference to the net income of the trust for the income year.	section 102K
3.	The trustee of a public trading trust is liable to pay income tax worked out by reference to the net income of the trust for the income year.	section 102S
4.	An entity that is liable to pay income tax (worked out by reference to taxable income or otherwise) is also liable to pay income tax worked out by reference to diverted income or diverted trust income for the income year.	section 121H
5.	An Australian insurer that re‑insures overseas can elect to pay, as agent for the re‑insurer, income tax worked out by reference to the amount of the re‑insurance premiums.	section 148

             (2)  For entities covered by an item in the table in subsection (1), the income year is the same as the *financial year, except in these cases:

                     (a)  for a company, or an entity covered by item 2 or 3 in the table, the income year is the previous financial year;

                     (b)  if an entity has an accounting period that is not the same as the financial year, each such accounting period or, for a company, each previous accounting period is an income year.

Note 1:       The Commissioner can allow an entity to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936.

Note 2:       An accounting period ends, and a new accounting period starts, when a partnership becomes, or ceases to be, a VCLP, an AFOF or a VCMP. See section 18A of the Income Tax Assessment Act 1936.

 

Division 10—Particular kinds of assessable income

10‑1  Effect of this Division

                   This Division is a *Guide.

10‑5  List of provisions about assessable income

                   The provisions set out in the table:

·         include in your assessable income amounts that are not *ordinary income; and

·         vary or replace the rules that would otherwise apply for certain kinds of *ordinary income.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

Accrued leave transfer payments
...................................................................................................	15‑5
alienated personal services income
...................................................................................................	86‑15
allowances
see employment
annual leave
see leave payments
annuities
...................................................................................................	27H
approved deposit fund (ADFs)
see superannuation
attributable income
see controlled foreign corporations and foreign investment funds
avoidance of tax
general .....................................................................................	177F
diversion of income ................................................................	121H
profits shifted out of Australia ............................................	136AD, 136AE
see also transfers of income
bad debts
see recoupment
balancing adjustment
see capital allowances, industrial property, investments, research & development, scientific research and tax exempt entities
banking
offshore banking activities, income from ...........................	121EG(1)
offshore banking unit, deemed interest on payments to by owner ...........................................................................	121EK
barter transactions
...................................................................................................	21, 21A, 15‑2
beneficiaries
see trusts
benefits
business, non‑cash ................................................................	21A
consideration, non‑cash .......................................................	21
meals you provide in an in‑house dining facility ..............	32‑70
see also employment and superannuation
bonus shares
see shares
bounties
...................................................................................................	15‑10
capital allowances
excess of termination value over adjustable value
generally................................................................	40‑285
for some cars.........................................................	40‑370
depreciating asset in low‑value pool...................................	40‑445(2)
expenditure in software development pool.........................	40‑460
recovery of petroleum resource rent tax..............................	40‑750(3)
capital gains
...................................................................................................	102‑5
see also insurance
car expenses
cents per kilometres reimbursement of ...............................	15‑70
carried interests
carried interests, not ordinary income.................................	118‑21
CFCs
see controlled foreign corporations
charters
see shipping
child
non‑trust income of, unearned .............................................	102AE
trust income of, unearned .....................................................	102AG
company
see controlled foreign corporations, co‑operative company, directors, dividends, liquidation, shareholders and shares
compensation
live stock or trees, recoveries for loss of ............................	385‑130
profits or income, insurance or indemnity for loss of........	15‑30
received by lessor for lessee’s non‑compliance with lease obligation to repair.................................................	15‑25
trading stock, insurance or indemnity for loss of .............	70‑115
see also insurance, live stock, recoupment and scientific research
consideration
see benefits
controlled foreign corporations (CFCs)
attributable income of ............................................................	456 to 459A
see also dividends and taxes
co‑operative company
receipts of ................................................................................	119
credit union
see co‑operative company
currency gains
see foreign exchange
currency losses
see recoupment
death
see trusts
debt/equity swap
see shares and units
defence forces
allowances and benefits for service as a member of .........	15‑2
depreciation
see capital allowances
directors
excessive remuneration or retirement payment from company ............................................................................	109
distributions
see dividends
dividends
benefit of LIC capital gain through a trust or partnership .............................................................................................	115‑280
general .....................................................................................	44(1)
distribution from a controlled foreign corporation ...........	47A(1)
foreign taxes on, grossing up of ..........................................	6AC
franked dividends, credits on................................................	207‑20(1), 207‑35(1), 207‑35(3)
repayments of foreign income tax deducted from .............	26A
see also liquidation
elections
local government, reimbursement of expenses of..............	25‑65
see also recoupment
electricity connections
see recoupment
eligible termination payments (ETPs)
...................................................................................................	27A to 27H
employees
see shares
employment
allowances and benefits in relation to employment or rendering services ...........................................................	15‑2
return to work payments .......................................................	15‑3
see also accrued leave transfer payments, eligible termination payments and leave payments
environment
see recoupment
farm management deposits
repayments of .........................................................................	393‑1 of Schedule 2G
FIFs
see foreign investment funds
films
Australian, proceeds of investment in ................................	26AG
foreign exchange
gains .........................................................................................	775‑15
see also recoupment
foreign investment funds (FIFs)
attributable income of ............................................................	529
foreign tax paid in respect of a foreign investment fund attribution account payment ..........................................	26D
see also taxes
forestry agreement
amount where section 82KZMG of the 1936 Act applies.	15‑45
franked dividends
see dividends
funeral policy
benefit under............................................................................	15‑55
general insurance
gross premiums.......................................................................	321‑45 of Schedule 2J
reduction in value of outstanding claims liability..............	321‑10 and 323‑5 of Schedule 2J
reduction in value of unearned premium reserve...............	321‑50 of Schedule 2J
grapevines
see recoupment
horticultural plants
see recoupment
improvements
see leases
imputation
see dividends
indemnity
see compensation and recoupment
industrial property
consideration for disposal of unit relating to copyright in Australian film...................................................................	124P
see also intellectual property and research and development
infrastructure borrowings
see interest
insurance
bonuses ...................................................................................	26AH, 15‑75
company, demutualisation of ...............................................	121AT
foreign life assurance policy ................................................	529
life assurance, transfer of contributions by superannuation fund or approved deposit fund to ....	275
payments from a non‑resident reinsurer in respect of a loss .............................................................................	148
premiums in respect of Australian business received by non‑resident insurers ......................................................	143
premiums paid to a non‑resident for reinsurance ..............	148
premiums paid to mutual insurance association ...............	121
premiums payable to a non‑resident for insurance of property in Australia .......................................................	142(1)
premiums payable to a non‑resident for insuring an event that can only happen in Australia ......................	142(1)
premiums payable to a non‑resident under an insurance contract with a resident ..................................................	142(2)
rebates and premiums refunded to a superannuation fund trustee .................................................................................	279A(1)
see also compensation, life insurance companies and recoupment
interest
infrastructure borrowings, on ..............................................	159GZZZZG
loans raised in Australia by foreign governments, on .....	27
overpaid tax, on ......................................................................	15‑35
qualifying securities, on ........................................................	159GQ, 159GW(1)
see also co‑operative companies and leases
investments
non‑interest bearing Commonwealth securities, gains on disposal or redemption of ...............................................	26C
prizes from investment‑related lotteries ..............................	26AJ
qualifying securities, payments to partial residents made under ..................................................................................	159GW(2)
qualifying securities, amount assessable to issuer of ......	159GT(1B)
qualifying securities, balancing adjustment on the transfer of ..........................................................................	159GS
securities, variation in terms of ............................................	159GV(2)
securities lending arrangements ..........................................	26BC
traditional securities, gains on the disposal or redemption of ...................................................................	26BB
see also films and interest
landcare operations
see recoupment
leased plant ..........................................................................................	Division 45
leases
amounts received by lessor from lessee for non‑compliance with lease obligation to repair...........	15‑25
interest component of payments under non‑leveraged finance leases ...................................................................	159GK
partnership leasing property under non‑leveraged finance lease, new partner or contribution of capital since 14 May 1985 ...........................................................	159GO
premiums relating to assignment of a lease granted before 20 September 1985................................................	26AB
profit on disposal of previously leased motor vehicles ...	Subdivision 20‑B
leases of luxury cars
accrual amounts......................................................................	Schedule 2E (42A‑35(1))
adjustment amounts (lessee).................................................	Schedule 2E (42A‑70(2))
adjustment amounts (lessor).................................................	Schedule 2E (42A‑65(2))
profit on actual sale................................................................	Schedule 2E (42A‑35(3))
profit on notional sale............................................................	Schedule 2E (42A‑35(2))
leave payments
accrued leave transfer payment ...........................................	15‑5
annual leave, received in lieu of retirement or termination ........................................................................	26AC
long service leave, received in lieu of retirement or termination ........................................................................	26AD
life insurance companies	Subdivision 320‑B
limited recourse debt
excessive deduction amount (debtor)..................................	243‑40
excessive deduction amount (partner).................................	243‑65
liquidation
distribution to a shareholder in winding up a company...	47(1)
live stock
death or destruction of ..........................................................	Subdivision 385‑E
departing Australia and ........................................................	385‑160, 385‑163
insolvency, and ......................................................................	385‑160, 385‑163
profits on death or disposal of .............................................	Subdivision 385‑E, 385‑160
see also compensation and trading stock
long service leave
see leave payments
losses
see compensation
lotteries
see investments
meals
see benefits
Mining
providing mining, quarrying or prospecting information	15‑40
minors
see child
motor vehicles
see car expenses and leases
mutual insurance
see insurance
non‑cash benefits
see benefits and employment
notional sales and loans
adjustment amounts (lessee).................................................	240‑110(2)
adjustment amounts (lessor).................................................	240‑105(2)
notional interest......................................................................	240‑35(1)
profit on actual sale................................................................	240‑35(3)
profit on notional sale............................................................	240‑35(2)
offshore banking units
see banking
partnerships
net income of, partner’s interest in ......................................	92(1)
uncontrolled partnership income, effect of ........................	94
see also leases
payments to members of copyright collecting societies
payments by copyright collecting societies.......................	15‑22
petroleum
resource rent tax, recovery of ...............................................	20‑30(1)
see also capital allowances
premiums
see insurance, leases and superannuation
primary production
see recoupment
prizes
see investments
profits
profit‑making undertaking or plan........................................	15‑15
sale of property acquired before 20 September 1985 for profit‑making by sale........................................................	25A
see also avoidance of tax
Project pools
An amount received for the abandonment, sale or other disposal of a project.........................................................	40‑830, 40‑832
property
see profits and trusts
quarrying
see mining and recoupment
rates
see recoupment
recoupment
insurance or indemnity for deductible losses or outgoings...........................................................................	Subdivision 20‑A
other recoupment for certain deductible losses or outgoings...........................................................................	Subdivision 20‑A
see also car expenses, compensation, elections and petroleum
reimbursements
see car expenses, dividends, elections, petroleum and recoupment
reinsurance
see insurance
research & development
consideration for loss or disposal etc. of plant, assets or buildings used for ............................................................	73B(23) to (27C), 73BF, 73BM, 73G(4)
return on ..................................................................................	73B(27A), (27C), 73BF(4), (6), 73BM(4), (6)
transferee of property used for, effect of disposal or change of use by .............................................................	73F(10)
residual value
see industrial property
retirement payments
see directors, leave payments and shareholders
rights to income
see transfers of income
roads
see timber
royalties
...................................................................................................	15‑20
schemes
see avoidance of tax
scholarship plan
benefit under............................................................................	15‑60
scientific research
consideration for disposal or destruction of buildings acquired for scientific research ......................................	73A(4)
securities
see investments
services
see co‑operative companies, employment, loans and trusts
shareholders
excessive remuneration or retirement payment from company ............................................................................	109
loans, payments and credits from company ......................	108, Division 7A of Part III
see also dividends
shares
acquired in a debt/equity swap, profit on the disposal cancellation or redemption of ........................................	63E(4)
bonus shares, cost of ............................................................	6BA
buy‑backs ................................................................................	159GZZZJ to 159GZZZT
employee share acquisition schemes ..................................	26AAC, 139 to 139GH
holding company shares held by a subsidiary, cancellation of ..................................................................	159GZZZC to 159GZZZI
small‑medium enterprise, profit on disposal of shares in .	128TG to 128TL
see also dividends
shipping
goods shipped in Australia, amounts paid to foreign shipowners and charterers for .......................................	129
small‑medium enterprises (SMEs)
see shares
subsidies
...................................................................................................	15‑10
sugar industry exit grants
...................................................................................................	15‑65
superannuation
benefits received from older superannuation funds .........	26AF, 26AFA, 26AFB
complying fund becomes non‑complying, effect of .........	288A
contributions to a superannuation fund ............................	278, 281, 286, 288
contributions to an approved deposit fund .......................	289, 290, 294, 295
non‑resident fund becoming resident, effect of ................	288B
payments and benefits from a fund .....................................	82AAQ
trustee’s liability to pay tax ..................................................	278, 286, 289, 294, 296
see also insurance
tax avoidance
see avoidance of tax and transfers of income
tax exempt entities
treatment of income and gains on becoming taxable ........	Schedule 2D
taxes
see dividends, foreign investment funds, interest and recoupment
termination of employment
see directors, eligible termination payments, leave payments and shareholders
theft
see recoupment
trading stock
change in interests in ............................................................	70‑100
death of trader and .................................................................	70‑105
difference between opening and closing value of ............	70‑35
disposal not at arm’s length..................................................	70‑20
disposal of outside ordinary course of business ..............	70‑90, 70‑95
see also compensation and tax exempt entities
transfers of income
consideration for transfer of right to income .....................	102CA
payments for transfer or disposal of property ...................	262
transferee, effect on of transfer of right to income ...........	102C
transferor, effect on of transfer of right to income ............	102B
travel expenses
see car expenses
trusts
beneficiary under legal disability or with a vested and indefeasible interest in trust income .............................	100
deceased estates, income of .................................................	101A
discretionary trusts ................................................................	101
net income of a trust estate, your present entitlement to	97, 101
non‑resident beneficiaries, liability to tax of ......................	98A
non‑resident trust estates to which you have transferred property or services, income of .....................................	102AAZD
property of applied for benefit of beneficiaries .................	99B
trust estate includes income from another trust estate	94(5)
trustees’ liability to tax...........................................................	98, 99, 99A, 102, 102K, 102S
see also avoidance of tax and superannuation
unearned income
see child
units
acquired in a debt/equity swap, profit on the disposal, cancellation or redemption of ........................................	63E(4)
water conservation
see recoupment
winding‑up
see insurance and liquidation
wool clips
double wool clips, treatment of ............................................	385‑135, 385‑155
work in progress
receipt of a work in progress amount ..................................	15‑50

 

 

Division 11—Particular kinds of non‑assessable income

Table of Subdivisions

11‑A      Lists of classes of exempt income

11‑B      Particular kinds off non‑assessable non‑exempt income

Subdivision 11‑A—Lists of classes of exempt income

Table of sections

11‑1A       Effect of this Subdivision

11‑1          Overview

11‑5          Entities that are exempt, no matter what kind of ordinary or statutory income they have

11‑10        Ordinary or statutory income which is exempt, no matter whose it is

11‑15        Ordinary or statutory income which is exempt only if it is derived by certain entities

11‑1A  Effect of this Subdivision

                   This Subdivision is a *Guide.

11‑1  Overview

                   Ordinary income or statutory income which is exempt from income tax can be divided into 3 main classes:

                     (a)  ordinary or statutory income of entities that are exempt, no matter what kind of ordinary or statutory income they have (see table in section 11‑5);

                     (b)  ordinary or statutory income which is exempt, no matter whose it is (see table in section 11‑10);

                     (c)  ordinary or statutory income which is exempt only if it is *derived by certain entities (see table in section 11‑15).

11‑5  Entities that are exempt, no matter what kind of ordinary or statutory income they have

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

Note:          Special rules apply to entities that cease to be exempt. See Schedule 2D to the Income Tax Assessment Act 1936.

 

charity, education, religion or science
charitable fund, public...............................................................	50‑5
charitable institution..................................................................	50‑5
educational institution, public..................................................	50‑5
religious institution....................................................................	50‑5
scientific institution....................................................................	50‑5
scientific research fund..............................................................	50‑5
scientific society etc...................................................................	50‑5
community service
community service society etc.................................................	50‑10
employees and employers
employee association.................................................................	50‑15
employer association.................................................................	50‑15
trade union...................................................................................	50‑15
film
Australian Film Finance Corporation.......................................	50‑45
funds established by will or trust
contributions to other funds.....................................................	50‑20
government
local governing body.................................................................	50‑25
municipal corporation................................................................	50‑25
public authority...........................................................................	50‑25
state/territory bodies..................................................................	24AK to 24AZ
health
health benefits organisation.....................................................	50‑30
hospital.........................................................................................	50‑30
medical benefits organisation...................................................	50‑30
HIH rescue package
..... HIH Claims Support Trust ..................................................	322‑10
mining
British Phosphate Commissioners Banaba Contingency Fund.................................................................................................	50‑35
Phosphate Mining Company of Christmas Island.................	50‑35
primary or secondary resources, and tourism
agricultural society etc. .............................................................	50‑40
aviation society etc. ..................................................................	50‑40
horticultural society etc. ...........................................................	50‑40
industrial society etc. ................................................................	50‑40
manufacturing society etc. .......................................................	50‑40
pastoral society etc. ..................................................................	50‑40
tourism society etc. ...................................................................	50‑40
viticultural society etc. ..............................................................	50‑40
sports, culture or recreation
animal racing society etc. .........................................................	50‑45
art society etc. ............................................................................	50‑45
game society etc. .......................................................................	50‑45
literature society etc. .................................................................	50‑45
music society etc. ......................................................................	50‑45
sport society etc. .......................................................................	50‑45

11‑10  Ordinary or statutory income which is exempt, no matter whose it is

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

dividends or shares
pooled development fund company dividend ......................	124ZM
pooled development fund company shares, income from sale of ....................................................................................	124ZN
financial transactions
infrastructure borrowings, income in relation to ...................	159GZZZZE
pooled development fund company dividends.....................	124ZM
pooled development fund company shares, income from sale of ....................................................................................	124ZN
foreign aspects of income taxation
Australian‑American Education Foundation, grant from.....	51‑10
Government co‑contributions
towards low income earner’s superannuation.......................	51‑65
interest
judgment debt, personal injury.................................................	51‑57, 23GA
non‑cash benefits
business benefit..........................................................................	23L(2)
exempt fringe benefit..................................................................	23L(1A)
sugar industry exit grants
.......................................................................................................	53‑10

11‑15  Ordinary or statutory income which is exempt only if it is derived by certain entities [see Note 7]

                   Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold, are provisions of the Income Tax Assessment Act 1936.

 

copyright collecting societies
copyright income....................................................................	51‑43(2)(a)
non‑copyright income up to certain limits..........................	51‑43(2)(b)
credit unions
interest......................................................................................	23G
defence
Defence Force member, allowances.....................................	51‑5
Defence Force member, compensation payments for loss of deployment allowance for warlike service................	51‑5
F‑111 Deseal/Reseal Ex‑gratia Lump Sum Payments.........	51‑5
Former Reserve Defence Force member, compensation payments for loss of pay and/or allowances................	51‑5
Reserve Defence Force member, pay and allowances.......	51‑5
education
bursary, educational allowance etc. ....................................	51‑10 and 51‑35
Commonwealth Trade Learning Scholarship, recipient of	51‑10
CRAFT scheme, employer’s income from...........................	51‑10
foreign student, scholarship and bursary to......................	842‑105
full‑time student, income from a scholarship, bursary, other educational allowance or educational assistance..........................................................................	51‑10 and 51‑35
isolated child, income for the provision of education of..	51‑10 and 51‑40
secondary student, income for the provision of education of ......................................................................	51‑10 and 51‑40
family assistance
child care benefit ....................................................................	52‑150
family tax benefit ....................................................................	52‑150
maternity allowance ...............................................................	52‑150
maternity immunisation allowance.......................................	52‑150
maternity payment..................................................................	52‑150
one‑off payment to families ..................................................	52‑150
payments to families under the scheme determined under Schedule 3 to the Family Assistance Legislation Amendment (More Help for Families—One‑off Payments) Act 2004 ........................................................	52‑150
foreign aspects of income taxation
approved overseas project, income from ...........................	23AF
Commonwealth of Nations country officer, official salary and foreign income ..........................................................	768‑100
consul and official staff member, official salary and foreign income ..................................................................	768‑100
Defence Force member, pay and allowances from being on eligible duty ................................................................	23AD
Defence Force member, non‑resident, pay and allowances of ....................................................................	842‑105
Defence Force member, pay and allowances from performing duties in operational areas .........................	23AC
defence of Australia, overseas person’s income from assisting in Australia’s defence.....................................	842‑105
diplomat and official staff member, official salary and foreign income ..................................................................	768‑100
educational, scientific, religious or philanthropic society, income of a visiting representive of ..............................	842‑105
expert, foreign resident, remuneration of ............................	842‑105
foreign society or association representative, income of	842‑105
government representative and members of the entourage, foreign resident, income of .........................	842‑105
non‑resident, foreign sourced income ................................	23(r)
OBU off‑shore investment trusts, income to which subsection 121D(6) applies ...........................................	121EL
OBU investment trusts for overseas charitable institutions.........................................................................	121EL(2)
overseas charitable institutions, income from OBUs........	121ELA(1)
overseas employment income, resident, income of ..........	23AG
persecution victim, payments to ..........................................	768‑105
press representative, foreign, income of ............................	842‑105
resistance fighter and victim of wartime persecution, payments to ......................................................................	768‑105
Territory resident, income from sources in a prescribed Territory ............................................................................	24G
Territory resident company or trust, income from sources outside Australia ..............................................	24F
United Nations, income from service with .........................	23AB
United States projects, income from approved overseas projects ..............................................................................	23AA
foreign investment
gain or profit from realisation of eligible venture capital investments.......................................................................	51‑54
gain or profit from realisation of venture capital equity....	51‑55
life insurance companies	Subdivision 320‑B
social security or like payments
Commonwealth education or training payment..................	Subdivision 52‑F
disability services payment ..................................................	53‑10
exceptional circumstances relief, payment for ...................	53‑10 and 53‑15
farm help income support......................................................	53‑10 and 53‑15
farm household support payment made by way of a grant of financial assistance............................................................................................. .	53‑10 and 53‑15
farm household support converted into a grant................	53‑25
2006 one‑off payment to older Australians under the Social Security Act 1991................................................	52‑10
payments under the scheme determined under item 1 of Schedule 2 to the Social Security and Veterans’ Entitlements Legislation Amendment (One‑off Payments to Increase Assistance for Older Australians and Carers and Other Measures) Act 2006....................................................................................	52‑10
2006 one‑off payment to older Australians under the Veterans’ Entitlements Act 1986...................................	52‑65
payments under the scheme determined under item 2 of Schedule 2 to the Social Security and Veterans’ Entitlements Legislation Amendment (One‑off Payments to Increase Assistance for Older Australians and Carers and Other Measures) Act 2006....................................................................................	52‑65
one‑off payment to carers (carer allowance related) or one‑off payment to carers (carer payment related) .....	52‑10
payments to carers under the scheme determined under Schedule 3 to the Family Assistance Legislation Amendment (More Help for Families—One‑off Payments) Act 2004 ........................................................	52‑10
2005 one‑off payment to carers (carer payment related), 2005 one‑off payment to carers (carer service pension related) or 2005 one‑off payment to carers (carer allowance related)..................................................	52‑10
payments under the scheme determined under Schedule 2 to the Social Security Legislation Amendment (One‑off Payments for Carers) Act 2005	52‑10
2006 one‑off payment to carers (carer payment related), 2006 one‑off payment to carers (wife pension related), 2006 one‑off payment to carers (partner service pension related), 2006 one‑off payment to carers (carer service pension related) or 2006 one‑off payment to carers (carer allowance related) ................	52‑10
payments under the scheme determined under Schedule 4 to the Social Security and Veterans’ Entitlements Legislation Amendment (One‑off Payments to Increase Assistance for Older Australians and Carers and Other Measures) Act 2006 ...................................................................................	52‑10
pension bonus.........................................................................	52‑10 and 52‑65
persecution victim, payments to ..........................................	768‑105
private health insurance.........................................................	52‑125
resistance fighter and victim of wartime persecution, payments to ......................................................................	768‑105
social security, payment to ...................................................	Subdivision 52‑A
travelling expenses for Australian participants in British nuclear tests .....................................................................	Subdivision 52‑CB
veteran, Australian and United Kingdom, payment to ....	53‑20
veteran, payment to ...............................................................	Subdivisions 52‑B and 52‑C
wounds and disability pension ............................................	53‑10
structured settlements and structured orders
annuities and lump sums........................................................	Subdivisions 54‑B, 54‑C and 54‑D
student
see education
superannuation or related business
Approved Deposit Fund, continuously complying fixed interest, income from 25 May 1988 deposits ...............	290A
Approved Deposit Fund, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993 ...	315C
Approved Deposit Fund, non‑reversionary bonuses on policies of life assurance ................................................	291A
Approved Deposit Fund, pre‑1 July 1988 income .............	291
pooled superannuation trust, income from constitutionally protected funds ...................................	297C
pooled superannuation trust, income from current pension liabilities of complying superannuation funds ..................................................................................	297B
pooled superannuation trust, non‑reversionary bonuses on policies of life assurance ...........................................	297A
pooled superannuation trust, pre‑1 July 1988 income ......	297
superannuation fund, income from current pension liabilities ............................................................................	283
superannuation fund, income from segregated current pensions assets ...............................................................	282B
superannuation fund, non‑reversionary bonuses on policies of life assurance ................................................	282A
superannuation fund, pre‑1 July 1988 income ...................	282
superannuation fund, regulated, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993 ...	315C
United Nations
Australian Federal Police member in Cambodia, pay and allowance ..........................................................................	23ADA
United Nations Service, income from ..................................	23AB
vice‑regal
Governor‑General, official salary and foreign income.......	51‑15
State Governor, official salary and foreign income............	51‑15
welfare
Handicapped Persons Assistance Act 1974, bonus from	51‑30
maintenance payment.............................................................	51‑30 and 51‑50
rent subsidy.............................................................................	51‑30

Note:          The following provisions of the Income Tax Assessment Act 1936 give rise to notional exempt income and not exempt income. For this reason the provisions do not appear in the lists of kinds of exempt income.

                   The provisions are: paragraphs 384(1)(b) and 385(1)(b), subsection 402(2) and sections 403 and 404.

Subdivision 11‑B—Particular kinds of non‑assessable non‑exempt income

Table of sections