ATO Interpretative Decision
ATO ID 2002/1103 (Withdrawn)
Income Tax
Division 6AA: excepted person - disabled childFOI status: may be released
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The decision is a straightforward application of section 70-110, ITAA 1997, and is not interpretative within the meaning of PSLA 2001/8.This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 taxpayer, a disabled child, an 'excepted person' under subsection 102AC(2) of the Income Tax Assessment Act 1936 (ITAA 1936)?
Decision
Yes. The taxpayer, a disabled child, is an excepted person under subsection 102AC(2) of the ITAA 1936.
Facts
The taxpayer was under 16 years of age.
The taxpayer has a physical, intellectual or psychiatric disability. They need the care and attention of another person on a daily basis. They need this care and attention to a substantially greater extent than a person of the same age who does not have any such disability.
The taxpayer is likely to need that care and attention permanently or for an extended period.
Reasons for Decision
Division 6AA of the ITAA 1936 ensures that special rates of tax and a lower tax free threshold apply in working out the basic income tax liability on taxable income, other than excepted income, derived by a prescribed person.
A 'prescribed person' is defined in subsection 102AC(1) of the ITAA 1936 to include any person, other than an excepted person (as defined in subsection 102AC(2) of the ITAA 1936), under 18 years of age at the end of the income year.
An 'excepted person' is defined in subsection 102AC(2) of the ITAA 1936 and includes a person in respect of whom the Commissioner has received a certificate issued by a legally qualified medical practitioner certifying that they are a disabled child, or a disabled adult, within the meaning of Part 2.19 of the Social Security Act 1991(subsubparagraph 102AC(2)(d)(i)(A) of the ITAA 1936).
A person will also be an excepted person where the Commissioner is satisfied that, on the last day of the income year, that they are a person of the kind referred to in subsubparagraph 102AC(2)(d)(i)(A) of the ITAA 1936 (subparagraph 102AC(2)(d)(ii)of the ITAA 1936).
A person is a 'disabled child' within the meaning of Part 2.19 of the Social Security Act (section 952 of the Social Security Act ) if:
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- they have a physical, intellectual or psychiatric disability;
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- they need care and attention from another person on a daily basis to an extent substantially greater than that needed by a person of the same age who does not have such a disability; and
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- the person is likely to need that care and attention permanently or for an extended period.
The taxpayer meets each of these requirements and the Commissioner would be satisfied that they are a 'disabled child' within the meaning of Part 2.19 of the Social Security Act. They are therefore an excepted person under subsection 102AC(2) of the ITAA 1936. Accordingly the special rates of tax under Division 6AA of the ITAA 1936 will not apply to income derived by the taxpayer during the year of income.
Date of decision: 6 November 2002Year of income: Year ended 30 June 2002
Legislative References:
Income Tax Assessment Act 1936
Division 6AA
subsection 102AC(1)
subsection 102AC(2)
subparagraph 102AC(2)(d)(ii)
subsubparagraph 102AC(2)(d)(i)(A)
Part 2.19
section 952
Keywords
Minors at law
Prescribed person issues
ISSN: 1445-2782
| Date: | Version: | |
| 6 November 2002 | Original statement | |
| You are here | 8 May 2009 | Archived |