• Legal database
Legal database
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This edited version has been archived due to the length of time since original publication.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: 1012344406382

    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.

    Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.

Ruling

Subject: Medicare levy surcharge

Question

Are you liable for Medicare Levy Surcharge (MLS)?

Answer

Yes.

This ruling applies for the following period

Year ended 30 June 2012

The scheme commenced on

1 July 2011

Relevant facts

You are married and have a child with your spouse.

You have other children who reside with your former spouse.

You pay child support for your children who live with your former spouse.

You hold private health insurance for yourself, your spouse and the child who lives with you.

Relevant legislative provisions

Medicare Levy Act 1986 Section 8D

Income Tax Assessment Act 1936 Subsection 251R(3)

Reasons for decision

Section 8D of the Medicare Levy Act 1986 (MLA) allows an increase of an additional 1% in the Medicare levy, where a taxpayer earns income in excess of the relevant threshold and does not have adequate private health insurance for themselves and all their dependants. This increase is known as the Medicare levy surcharge (MLS).

Subsection 251R(3) of the Income Tax Assessment Act 1936 (ITAA 1936) provides that a taxpayer will be taken to have a dependant if, during any part of the year of income:

    · the person was a resident of Australia;

    · the person was either: 

      a spouse of the taxpayer;

      a child of the taxpayer less than 16 years of age; or

      a child of the taxpayer not less than 16 years of age but less than 25 years of age and receiving full-time education at a school, college or university; and the taxpayer contributed to the maintenance of the person.

The payment of child support is regarded as contributing to the maintenance of a dependant. This is the case irrespective of whether the support is provided direct to the care giver or paid through some other avenue such as via Child Support Agency.

You maintained a dependant if any of the following applied:

    · you and your dependant lived in the same house

    · you gave your dependant food, clothing and lodging

    · you helped them to pay for their living, medical and educational costs.

In your case, you contributed to your children's maintenance via child support payments. Accordingly, your children are dependants for MLS purposes as defined in subsection 251R(3) of the ITAA 1936.

As you are considered to have X dependant children and not all are covered by adequate private health insurance, you are liable for MLS.


Back to top