| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your private ruling
Authorisation Number: 1012566604715
Ruling
Subject: Income
Question
Is the one-off payment, which you will receive as a gift, assessable income?
Answer
No
This ruling applies for the following period
Year ending 30 June 2014
The scheme commenced on
1 July 2013
Relevant facts
A relative is looking to deposit money from their bank account into your bank account.
Both accounts are held in Australia
The payment is being made voluntarily and there no obligation on you to provide any services or employment duties.
Relevant legislative provisions
Income Tax Assessment Act 1997 Subsection 6-5(2)
Reasons for decision
Subsection 6-5(2) of the Income Tax Assessment Act 1997 provides that the assessable income of an Australian resident includes ordinary income derived directly or indirectly from all sources, whether in or out of Australia, during the income year.
Taxation Ruling TR 2005/13 provides principles relevant to the determination of whether the receipt of money constitutes a gift. This ruling highlights that rather than attempting to define a 'gift', the courts have described a gift as having the following characteristics and features:
· there is a transfer of the beneficial interest in property,
· the transfer is made voluntarily,
· the transfer arises by way of benefaction, and
· no material benefit or advantage is received by the giver by way of return.
Whether a gift is assessable income depends on the character of the gift in the hands of the recipient. Consideration is necessary of the whole of the circumstances in which the gift is received.
A personal gift received by you for personal reasons, where there is no connection between the receipt of the gift and any income-producing activity by you, is not assessable income.
In your situation, a payment from your relative will be deposited into your bank account. The payment will be made to you voluntarily and not as a result of any services that you performed.
Accordingly the one-off payment that you will receive is not required to be included in your assessable income.
Copyright notice
© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
