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Edited version of private advice
Authorisation Number: 1052302304016
Date of advice: 10 September 2024
Ruling
Subject: Assessable income - foreign pension
Question
Is the Pension you receive from another country included in your assessable income under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)?
Answer
No.
Subsection 6-5(2) of the ITAA 1997 provides that the assessable income of a resident taxpayer includes ordinary income derived directly or indirectly from all sources, whether in or out of Australia, during the income year.
However, article XX of the Convention between the government of Australia and the government of the other country for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, provides that public pensions paid by the other country to a resident of Australia or a citizen of the other country, shall only be taxable in the other country.
Accordingly, the Pension you receive is therefore not assessable income under section 6-5 of the ITAA 1997 as you are a resident of Australia.
This ruling applies for the following periods:
Period ended 30 June 20XX
Period ended 30 June 20XX
Period ending 30 June 20XX
Period ending 30 June 20XX
Period ending 30 June 20XX
Period ending 30 June 20XX
The scheme commenced on:
1 July 20XX
Relevant facts and circumstances
You are an Australian resident for tax purposes.
You are not a citizen of the other country.
Your spouse was a Veteran who served for the government in the other country.
Your spouse passed away on XX/XX 20XX.
Your spouse was receiving a pension from the other country prior to passing away.
You were granted a Pension from the other country which became effective on XX/XX 20XX.
You commenced receiving these payments on XX/XX 20XX.
Relevant legislative provisions
Income Tax Assessment Act 1997 section 6-5
International Tax Agreements Act 1953