| 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: 1052210137005
Date of advice: 14 February 2024
Ruling
Subject: Assessable income - gift
Question
Is the lump sum gifted to you assessable under section 6-5 or section 15-2 of the Income Tax Assessment Act (ITAA 1997)?
Answer
No - the funds gifted to you do not have the features of ordinary income therefore are not considered assessable income.
This private ruling applies for the following period:
Year ended X June 20XX.
The scheme commenced on:
X July 20XX.
Relevant facts and circumstances
You were a resident of Australia for tax purposes at all relevant times for this ruling.
You were employed at Company A for over X years. Company A is a subsidiary of Company B.
You were promoted in 20XX.
During your employment, you became close with two senior employees ('the donors') of Company B.
You often attended non-business related events together.
In 20XX, the donors advised you of an intention to sell Company A.
Around the same time, the donors advised you of their intention to provide you with a 'gift' by way of thanking you for your service to Company A.
Company A was sold in 20XX, with settlement occurring shortly after.
You continued to work for Company A following the sale until you were advised of their intention to terminate your employment.
You chose to facilitate this termination by signing a resignation deed and were paid all leave entitlements.
At the time of termination, your salary was $X.
In 20XX, one of the donors contacted you offering you a position at Company B in another country.
You declined this offer.
In 20XX, you received a deed of gift from the donors.
The deed outlined the intention to distribute a lump sum of $X to you.
You have provided relevant clauses of the deed of gift.
You sought other employment opportunities in Australia which was unsuccessful.
Subsequently, you accepted a position at Company B in 20XX, and relocated to another country in 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
Income Tax Assessment Act 1997 section 15-2