Taxability of disaster relief payments 2010-11

Introduction

During the 2010-11 financial year, you may have been one of the many Australians who were affected by natural disasters. If you received a natural disaster relief payment, you need to understand how it affects your tax. Some of these payments are treated for tax purposes as:

• exempt income
• non-assessable non-exempt payments, or
• amounts you do not need to pay tax on (not taxable).

This document lists some of the payments that have been made by federal, state or local governments and how they should be treated on your tax return. If a payment is:

• exempt income - you do not pay tax on this amount, but the amount is included when working out a tax loss
• non-assessable non-exempt income - it does not need to be included anywhere on your tax return
• not taxable - it also does not need to be included on your tax return.