| Disclaimer 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 private advice
Authorisation Number: 1052080984789
Date of advice: 31 January 2023
Ruling
Subject: Assessable income - compensation
Question
Is the lump sum compensation payment you received assessable income?
Answer
No.
You received a single lump sum payment to compensate for abuse you suffered as a child. The payment has none of the indicia of income including periodicity, recurrence, or regularity. Therefore, the payment is not included in your assessable income.
Further, the payment is exempt from capital gains tax (CGT) as it was paid to compensate for personal harm you suffered.
This ruling applies for the following period:
Year ending 30 June 20XX
The scheme commences on:
1 July 20XX
Relevant facts and circumstances
You applied for compensation for abuse you suffered as a child.
You were advised by letter that your application was successful.
You received a lump sum payment.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
Income Tax Assessment Act 1997 section 6-10
Income Tax Assessment Act 1997 section 118-137
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).
