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Redress scheme payments

Redress scheme payments made as compensation or damages for a wrong, injury or illness are non-assessable income.

Last updated 25 April 2023

What is a redress scheme?

Redress schemes are about making an acknowledgement for wrongs in the past. They have general features that include payments for harm, harassment or discrimination of a person.

Redress scheme payments may be compensation for:

  • damages for a wrong, injury or illness an individual suffers personally – are non- assessable payments
  • financial loss or on termination – may be assessable.

Redress scheme payments and your tax return

You don't need to declare any compensation payments you receive from a redress scheme for personal injury you suffer. These payments are non-assessable income. This means you don't need to include these amounts in your tax return.

These payments are also not subject to capital gains tax.

Examples of redress schemes

Several state and national redress schemes have come into operation in the last few years, such as the: