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Edited version of your written advice
Authorisation Number: 1012910780435
Date of advice: 12 November 2015
Ruling
Subject: Assessability of weekly workers compensation payments
Question and answer:
Does your assessable income include amounts of weekly workers compensation benefits paid to you?
Yes.
This ruling applies for the following period:
1 July 2014 to 30 June 2015.
The scheme commenced on:
1 July 2014.
Relevant facts and circumstances:
You were injured in a workplace accident.
You received weekly workers compensation payments to compensate you for your loss of income.
Relevant legislative provisions:
Income Tax Assessment Act 1997 Section 6-5.
Reasons for decision
Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that the assessable income of an Australian resident taxpayer includes the ordinary income they derive directly or indirectly from all sources, whether in or out of Australia, during an income year.
Receipts that are considered ordinary income include salary and wages, weekly workers compensation payments paid in lieu of salary or wages lost through a workplace injury,.
The workers compensation payments you received constitute ordinary income and are included in your assessable income in the year you received them under the provisions of section 6-5 of the ITAA 1997.