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Edited version of your private ruling
Authorisation Number: 1012294071535
This edited version of your ruling will be published in the public register of private binding rulings after 28 days from the issue date of the ruling. The attached private rulings fact sheet has more information.
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Ruling
Subject: Adjusted taxable income
Question
Are you required to include your spouse's superannuation pension when calculating their ATI for the purposes of the dependant spouse tax offset?
Answer
No.
This ruling applies for the following periods:
Year ended 30 June 2010
Year ended 30 June 2011
The scheme commences on:
1 July 2009
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
Your spouse received a superannuation pension.
Your spouse is over 60 years of age.
Relevant legislative provisions
Income Tax Assessment Act 1936 section 159J, and
Income Tax Assessment Act 1936 subsection 159J(4).
Reasons for decision
Section 159J of the Income Tax Assessment Act 1936 (ITAA 1936) provides that a taxpayer may be entitled to a tax offset where, during the year of income, they contribute to the maintenance of a dependant who is a resident of Australia.
Where a person is entitled to a dependent spouse tax offset, that tax offset may be reduced in part or in full by the dependant's ATI.
Subsection 159J(4) of the ITAA 1936 provides for the amount of the tax offset otherwise allowable to be reduced by $1 for every $4 by which the ATI derived by the dependant in the year of income exceeds $282.
An individual's ATI for a particular year is the sum of the following amounts:
· the individual's taxable income,
· the individual's adjusted fringe benefits amount,
· the individual's tax-free government pensions or benefits; however do not include any superannuation benefits (income streams or lump sums),
· the individual's target foreign income (includes any income earned from overseas that is not already included in your taxable income or received in the form of a fringe benefit),
· reportable super contributions (includes both reportable employer super contributions and deductible personal super contributions),
· total net investment loss (includes both net financial investment loss and net rental property loss),
· Less the individual's deductible child maintenance expenditure (child support you paid).
A taxpayer will be eligible to claim the dependent spouse tax offset if their spouse was born before 1 July 1971, their ATI for the 2011-12 financial year is below $150,000 and their spouse's ATI is less than $9,702.
In your case, your spouse received a superannuation pension. This type of payment is not included in the list above; as such you are not required to include this amount in your spouse's adjusted taxable income.
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