Income Tax Assessment Act 1997
The *tax free component of a *death benefit termination payment that you receive after the death of a person of whom you are a *death benefits dependant is not assessable income and is not *exempt income. Taxable component 82-65(2)
If you receive a *death benefit termination payment after the death of a person of whom you are a *death benefits dependant:
(a) the part of the *taxable component of the payment mentioned in subsection (3) is not assessable income and is not *exempt income; and
(b) the remainder of the taxable component (if any) of the payment is assessable income.
The remainder of the taxable component is taxed at the top marginal rate in accordance with the Income Tax Rates Act 1986 .82-65(3)
The amount is so much of the *taxable component of the payment as does not exceed the *ETP cap amount.
For the ETP cap amount, see section 82-160 .82-65(4)
The *ETP cap amount is reduced (but not below zero) by the amount worked out under subsection (3) for each *death benefit termination payment (if any) you have received earlier in consequence of the same employment termination, whether in the income year or an earlier income year.
See subsection 82-75(2) for the tax treatment of any amount by which you may have benefited from an employment termination payment to the trustee of the estate of the deceased.
If you have also received a life benefit termination payment in the same income year, your entitlement to a tax concession under this section is not affected by your entitlement (if any) to an offset for the life benefit termination payment (under section 82-10 ).