TPI is the amount-if any-remaining after taking away from your assessable professional income:
- the total of the deductions that reasonably relate to this income
- a part of any apportionable deductions-for example, gifts to charity which you have shown at item D8 on your tax return.
Once your TPI has exceeded $2,500 (year 1), you are eligible for averaging in later years even where your TPI does not exceed that amount.
For the Australian Taxation Office (ATO) to work out your income averaging, you must complete Z item 22 on your 2003 tax return for individuals (supplementary section). The amount to write at Z is your assessable professional income less the amount at 1 as described above. The ATO will do the calculation required by 2 to work out your TPI.
At V item 22, write the total of your category 2 other income-see Other income in question 22, TaxPack 2003 supplement-including the amount you have worked out for Z item 22. Do not include any amounts already shown at items 1, 2, 12, 13, or 14 on your tax return. If you have not shown your TPI at other items on your tax return, you must include it at V item 22. If you include your TPI at V, do not claim at items D1 to D10 or D11 to D15 on your tax return any deductions you used to work out that income.