ATO Interpretative Decision
ATO ID 2002/107 (Withdrawn)
Income Tax
Medicare Levy Surcharge - taxpayer and spouse with private patient hospital coverFOI status: may be released
-
This ATO ID is a straight application of the law and does not contain an interpretative decision.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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 a taxpayer liable to pay the Medicare Levy Surcharge imposed under section 8D of the Medicare Levy Act 1986 (MLA 1986) where the taxpayer and their spouse have had private patient hospital cover for the full year of income?
Decision
No. A taxpayer is not liable for the Medicare levy surcharge under section 8D of the MLA 1986 where they and their spouse have had private patient hospital cover for the full year of income.
Facts
The taxpayer is married but has no other dependants.
The taxpayer and their spouse had private patient hospital cover for the full year of income.
Neither the taxpayer nor their spouse were prescribed persons.
The combined taxable income of the taxpayer and their spouse exceeded $100 000.
Reasons for Decision
Section 8D of the MLA 1986 provides that a taxpayer will be subject to a Medicare levy surcharge where, for the whole or part of a year of income:
- •
- they are married;
- •
- they or at least one of their dependants (unless the dependant is a prescribed person) is not covered by private patient hospital cover; and
- •
- they are not a prescribed person.
Where a taxpayer satisfies all the above tests for the whole of the year of income and the combined taxable income (including reportable fringe benefits) of the taxpayer and their spouse exceeds the family surcharge threshold, a surcharge of 1 per cent of the taxpayer's taxable income is payable in addition to the amount of the Medicare levy otherwise payable.
The family surcharge threshold is defined in section 3A of the MLA 1986 as $100 000 where the taxpayer has only one dependant.
As the taxpayer and their spouse had private patient hospital cover for the full year of income, the taxpayer is not liable to pay the Medicare levy surcharge under section 8D of the MLA 1986.
Date of decision: 21 November 2001Year of income: Year ended 30 June 1998
Legislative References:
Medicare Levy Act 1986
section 3A
section 8D
Keywords
Medicare levy
Medicare levy surcharge
ISSN: 1445-2782
| Date: | Version: | |
| 21 November 2001 | Original statement | |
| You are here | 26 August 2005 | Archived |