ATO Interpretative Decision

ATO ID 2002/1050

Income Tax

Lump sum payment in arrears tax offset - trustee of a deceased estate
FOI status: may be released

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CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.

Issue

Is the trustee of a deceased entitled to a lump sum payment in arrears tax offset under section 159ZRA of the Income Tax Assessment Act 1936 (ITAA 1936)?

Decision

No. The trustee of the estate of a deceased is not entitled to a lump sum payment in arrears tax offset under section 159ZRA of the ITAA 1936.

Facts

The taxpayer is the trustee of a deceased estate.

The income of the trust included an assessable lump sum payment.

The trustee will be assessable on this income as income to which no beneficiary is presently entitled.

Reasons for Decision

Section 159ZRA of the ITAA 1936 allows a lump sum payment in arrears tax offset where the taxpayer's assessable income in a year of income includes one or more eligible lump sums.

However, subsection 159ZRA(2) of the ITAA 1936 specifically provides that the taxpayer must be a natural person (otherwise than in the capacity of a trustee).

Accordingly, the taxpayer, as trustee of the estate, is not eligible to the lump sum in arrears tax offset under section 159ZRA of the ITAA 1936.

Date of decision:  1 November 2002

Year of income:  Year ended 30 June 2001

Legislative References:
Income Tax Assessment Act 1936
   section 159ZRA
   subsection 159ZRA(2)

Related ATO Interpretative Decisions
ATO ID 2002/1049

Keywords
Deceased estates
Trustees
Lump sum payments in arrears
Lump sum payments in arrears tax offsets

Business Line:  Business & Personal Tax Centre of Expertise

Date of publication:  20 November 2002

ISSN: 1445-2782

history
  Date: Version:
You are here 1 November 2002 Original statement
  28 October 2005 Archived