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Edited version of your private ruling
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Ruling
Subject: Flood levy exemption
Question
Are you required to pay the Temporary Flood and Cyclone Reconstruction Levy (the flood levy)?
Answer
No.
This ruling applies for the following period
1 July 2011 to 30 June 2012
The scheme commenced on
1 July 2011
Relevant facts and circumstances
You were working away from your principal place of residence when a natural disaster occurred.
You were unable to return to your principal place of residence because the airport was closed for more than 24 hours.
You did not receive an Australian Government Disaster Recovery Payment (AGDRP) and are an Australian resident over 16 years of age.
Relevant legislative provisions
Income Tax (Transitional Provisions) Act 1997 Section 4-10.
Reasons for decision
Summary
As you were unable to gain access to your principle place of residence for at least 24 hours due to a natural disaster you meet the criteria for an exemption from paying the flood levy.
Detailed reasoning
The Australian Government has introduced the flood levy for the financial year ended 30 June 2012. The flood levy is designed to assist affected communities to recover from the recent natural disasters by providing additional funding to rebuild essential infrastructure, such as, roads, bridges and schools.
Section 4-10 of the Income Tax (Transitional Provisions) Act 1997 states you must pay the flood levy where your taxable income for the 2011-12 financial year exceeds $50,000 unless you are covered by the exemption provision.
The exemption provision requires the Minister to specify the classes of individuals in a legislative instrument who are not required to pay the levy. As stated in the legislative instrument Income Tax - Temporary Flood and Cyclone Reconstruction Levy Exemption 2011, you are not required to pay the levy if you are a member of one of the three exemption classes described below:
Class 1 - you were eligible for an AGDRP for a natural disaster that occurred during the 2010-11 or 2011-12 financial year and you received the payment by 30 June 2012
Class 2 - you were affected by:
· an event that occurred during the 2010-11 financial year which was declared as a natural disaster under the Natural Disaster Relief and Recovery Arrangements (NDRRA), and
· you were at least 16 years old at the time of the disaster, and
· you were an Australian resident for social security reasons at the time of the disaster, and
· you were unable to gain access to your principal place of residence for at least 24 hours.
Class 3 - you are a New Zealand citizen who received an ex-gratia payment from Centrelink by 30 June 2012 for a natural disaster that occurred in the 2010-11 or 2011-12 financial year.
Application to your circumstances
You were affected by an NDRAA declared natural disaster.
When the natural disaster occurred you were unable to return to your principal place of residence as the airport was closed for more than 24 hours.
You are exempt from paying the flood levy as you meet the conditions for a Class 2 exemption. That is, you were affected by a natural disaster, are an Australian resident for social security purposes aged over 16 years of age and were unable to gain access to your principal place of residence for at least 24 hours.
Accordingly, you are not required to pay the flood levy for the year ended 30 June 2012.
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