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Edited version of your private ruling
Authorisation Number: 1012561919237
Ruling
Subject: Assessable income
Question
Is the distribution you receive considered assessable income?
Answer
No.
This ruling applies for the following period:
Year ended 30 June 2013
The scheme commences on:
1 July 2012
Relevant facts and circumstances
You and your siblings own a residential property in which you reside in.
You pay weekly rent.
Throughout the year each of you receive a distribution from the account, after expenses have been accounted for, based on your relative ownership percentages.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 6-5.
Reasons for decision
Section 6-5 of the Income Tax Assessment Act 1997 provides that the assessable income of an Australian resident includes all ordinary income derived directly or indirectly from all sources.
The mutuality principle however recognises that a person's income consists only of moneys derived from external sources. Where a number of persons contribute to a common fund created and controlled by them for a common purpose, any surplus arising from the use of that fund for the common purpose is not income.
We accept that the distribution you receive is not assessable income due to the principles of mutuality. The distribution you receive is simply a portion of the surplus funds from the account after the expenses have been accounted for.
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