INCOME TAX ASSESSMENT ACT 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-20 - TAX OFFSETS  

Division 61 - Generally applicable tax offsets  

Subdivision 61-D - Low and Middle Income tax offset and Low Income tax offset  

Operative provisions

SECTION 61-115   Amount of the Low Income tax offset  

General rule

61-115(1)  
The amount of your *tax offset is set out in the following table in respect of the following income (your relevant income ):


(a) if you are an individual - your taxable income for the income year;


(b) if you are a trustee - the amount of the share of *net income referred to in subsection 61-110(2) .


Amount of your tax offset
Item If your relevant income: The amount of your tax offset is:
1 does not exceed $37,500 $700
2 exceeds $37,500 but is not more than $45,000 $700, less an amount equal to 5% of the excess
3 exceeds $45,000 but is not more than $66,667 $325, less an amount equal to 1.5% of the excess

If you are less than 18 years of age

61-115(2)  
Despite subsection (1), the amount of your *tax offset for the income year cannot exceed a cap if:


(a) you are an individual who is a prescribed person in relation to the income year for the purposes of Division 6AA of Part III of the Income Tax Assessment Act 1936 ; and


(b) part (the excluded part ) of your basic income tax liability for the income year is attributable to your eligible taxable income (within the meaning of section 102AD of that Act).

The cap is an amount equal to the remaining part of your basic income tax liability for the income year.

Note:

Division 6AA (including section 102AD ) is about income that particular kinds of children derive from particular sources.

61-115(3)  
When working out the remaining part of your basic income tax liability, if you are also entitled to a *tax offset under section 160AAA of the Income Tax Assessment Act 1936 , treat that tax offset as having been applied, to the extent possible, against the excluded part of your basic income tax liability.

Note:

That tax offset is for individuals eligible for certain benefits.

If you are a trustee and the beneficiary is less than 18 years of age

61-115(4)  
Despite subsection (1), the amount of your *tax offset for the income year cannot exceed a cap if:


(a) you are a trustee; and


(b) the beneficiary who is presently entitled to the share of *net income to which the tax offset relates is a prescribed person in relation to the income year for the purposes of Division 6AA of Part III of the Income Tax Assessment Act 1936 ; and


(c) part of your basic income tax liability for the income year is attributable to the portion of that share to which that Division applies.

The cap is an amount equal to the part of your basic income tax liability attributable to the remaining portion of that share.

Note 1:

Division 6AA is about income that particular kinds of children derive from particular sources.

Note 2:

To work out the portion of that share to which Division 6AA applies, see section 102AG of the Income Tax Assessment Act 1936 .


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