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This edited version has been archived due to the length of time since original publication.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 written advice

Authorisation Number: 1013082023188

Date of advice: 6 September 2016

Ruling

Subject: Excepted person

Question

Are you an excepted person for the purposes of Division 6AA of the Income Tax Assessment Act 1936 (ITAA 1936)?

Answer

Yes.

This ruling applies for the following periods

Year ending 30 June 2017

Year ending 30 June 2018

Year ending 30 June 2019

Year ending 30 June 2020

The scheme commenced on

1 July 2016

Relevant facts and circumstances

You are under the age of 18.

You need care and attention on a daily basis from another person for the foreseeable future.

You meet the definition of a disabled child under the Social Security Act 1991. As per a letter from your Paediatrician which applies from 30 June 2016.

Relevant legislative provisions

Income Tax Assessment Act 1936 Division 6AA

Income Tax Assessment Act 1936 subsection 102AC(2)

Social Security Act 1991 Part 2.19

Reasons for decision

Division 6AA of the Income Tax Assessment Act 1936 (ITAA 1936) imposes a higher rate of tax on 'eligible taxable income' derived by a person who is less than 18 years of age at the end of the year of income if they are not an 'excepted person'.

An excepted person is defined in subsection 102AC(2) of the ITAA 1936 and includes a person in respect of whom the Commissioner: 

    • has received a certificate issued by a legally qualified medical practitioner certifying that the minor is a disabled child within the meaning of Part 2.19 of the Social Security Act 1991 (SSA), and

    • is satisfied that, on the last day of the income year, the person is a disabled child within the meaning of Part 2.19 of the SSA.

Part 2.19 of the SSA is thhahae legislation for carer allowance.

Section 953 of the Social Security Act 1991 provides the conditions that must be met in order to qualify for a carer allowance. One of these conditions is that either of the following must apply:

    • The disability from which the care receiver is suffering is declared, under subsection 38E(3), to be a recognised disability for the purposes of this section; or

    • The person has been given a qualifying rating of intense under the disability care load assessment (child) determination for the care receiver.

After careful examination of part 2.19 of the Social Security Act 1991, it is evident that the intention of this legislation is to determine whether a person is eligible for a carer allowance.

Accordingly, a minor will be considered a 'disabled child' within the meaning of part 2.19 of the Social Security Act 1991 if:

    • they have a physical, intellectual or psychiatric disability;

    • they need care and attention from another person on a daily basis to an extent substantially greater than that needed by a person of the same age who does not have such a disability; and

    • the person is likely to need care and attention permanently or for an extended period of time.

You have a disability which meets the definition under Part 2.19 of the Social Security Act 1991.

Accordingly, you are an excepted person for the purposes of Division 6AA of the ITAA 1936.


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