| Disclaimer This edited version has been archived due to the length of time since original publication.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 private advice
Authorisation Number: 1051602449966
Date of advice: 1 November 2019
Ruling
Subject: Assessable income and capital gain
Question
Is the pecuniary penalty you received assessable income?
Answer
No
Question
Is the pecuniary penalty you received disregarded as a capital gain under section 118-37(1)(a) of the Income Tax Assessment Act 1997?
Answer
Yes
This ruling applies for the following period:
Year ended 30 June 2019
The scheme commences on:
1 July 2018
Relevant facts and circumstances
You received a court order for a payment consisting of your former employer's failure to pay underpaid wages, failure to pay for notice of termination and failure to pay accrued leave on termination.
You also received a court order for a separate payment consisting of a pecuniary penalty to be paid by your former employer pursuant to section 546(1) of the Fair Work Act 2009 (Cth).
Relevant legislative provisions
Income Tax Assessment Act 1997 section 118-37(1)(a)