ATO Interpretative Decision
ATO ID 2002/222
Personal tax
Exemption of summer vacation scholarship income - meaning of full-time studentFOI status: may be released
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 a part-time summer vacation scholarship received by a student who is undertaking a full-time undergraduate course exempt from tax under section 51-10 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Decision
Yes. A student who is undertaking a full-time undergraduate course is a full-time student during the period they are in receipt of a summer vacation scholarship. The part-time summer vacation scholarship is exempt from tax under section 51-10 of the ITAA 1997.
Facts
The taxpayer, who is undertaking a full-time undergraduate course at a university, was awarded a summer vacation scholarship by the university to enrol in the university's summer vacation program.
For the purpose of determining the fees applicable, the taxpayer's enrolment constituted a part-time academic summer program.
The part-time summer vacation scholarship is principally for educational purposes.
Reasons for Decision
Section 51-10 of the ITAA 1997 exempts from tax income received by a full-time student at a school, college or university from a scholarship, bursary educational allowance or educational assistance.
As the taxpayer is undertaking a full-time undergraduate course, they meet the requirement of section 51-10 of the ITAA 1997 that they be a full-time student. The fact that the program for which the taxpayer was provided the scholarship was undertaken while on university vacation does not alter their status as a full-time student. Nor is this status altered by the fact that the taxpayer's summer vacation enrolment may have constituted a part-time academic summer program.
Date of decision: 13 February 2002
Legislative References:
Income Tax Assessment Act 1997
section 51-10
ATO ID 2002/220
ATO ID 2002/221
Keywords
Exempt income
Scholarships, fellowships & bursaries
Date reviewed: 3 December 2013
ISSN: 1445-2782