ATO Interpretative Decision
ATO ID 2001/408 (Withdrawn)
Income Tax
Income of children - Carer AllowanceFOI status: may be released
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The decision is a straightforward application of of the 'excepted person' definition in section 102AC, ITAA 1936, 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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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
Does Division 6AA of the Income Tax Assessment Act 1936 (ITAA 1936) apply to income received by a taxpayer who is under 18 years of age and is in receipt of Carer Allowance?
Decision
No, Division 6AA of the ITAA 1936 will not apply to income received by a taxpayer who is under 18 years of age and in receipt of a Carer Allowance.
Facts
The taxpayer was under 18 years of age at the end of the year of income.
The taxpayer has a disability.
The taxpayer was in receipt of a Carer Allowance (previously known as a child disability allowance) at the end of the year of income.
Reasons for Decision
Division 6AA of the ITAA 1936 imposes a higher rate of tax on 'eligible taxable income' derived by a person who is less than 18 years of age at the end of the year of income if they are not an 'excepted person'.
An 'excepted person' is defined in section 102AC of the ITAA 1936 and includes a person in respect of whom a carer allowance was payable under the Social Security Act 1991 on the last day of the year of income.
As the taxpayer was under 18 years of age and in receipt of the Carer Allowance on the last day of the year of income, they are an 'excepted person' under section 102AC of the ITAA 1936. Division 6AA of the ITAA 1936 will therefore not apply to income derived by the taxpayer during the year of income.
Date of decision: 30 August 2001
Legislative References:
Income Tax Assessment Act 1936
Division 6AA
section 102AC
The Act
Keywords
Children's income
Minors at law
ISSN: 1445-2782
| Date: | Version: | |
| 30 August 2001 | Original statement | |
| You are here | 8 May 2009 | Archived |
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