Things you need to know
Life insurance policies are issued by life insurance companies and friendly societies.
You need to include a bonus amount at this question if all the following conditions apply:
- You received the bonus amount, or directed how it is to be dealt with, within 10 years from when the policy started.
- Your life insurance policy or friendly society insurance bond matured, or was terminated, forfeited, or surrendered in full or in part.
- The bonus amount was in addition to the premiums you paid to the life insurance company or friendly society.
If during the term of your life insurance policy or bond, you increased the amount of your premiums by more than 25% of the amount of premiums you paid in the previous policy year, your policy is taken to start at the beginning of the policy year in which you paid the increased premiums. This means that you may need to include some or all of a bonus amount in your assessable income.
You can't claim a loss if your life insurance policy or friendly society insurance bond matured or was partly or fully surrendered, terminated or forfeited.
Different rules apply to a bonus received from a policy that started on or after 28 August 1982 and before 8 December 1983. Generally, such a bonus does not need to be included in assessable income unless the policy has been taken to start at a later date and the rules apply. If you are not sure whether you need to include your bonus, contact us.
Don't declare as income
Don't declare as income the following:
- bonus amounts received after the tenth year of the policy
- life insurance bonuses from policies that
- you started before 28 August 1982
- matured due to the death of the person insured
- you surrendered due to an accident, illness or other disability of the person insured
- you surrendered due to severe financial hardship
- are retirement savings accounts
- benefits you received from a friendly society that are bonuses from income bonds; include these amounts at question 24 Other income 2024.
If you have received a statement detailing the bonus amount allocated to your continuing life insurance policy or friendly society bond but you have not actually received the bonus or directed how it is to be dealt with, don't include the bonus amount as income.
Did you receive a bonus because your life insurance policy or friendly society insurance bond matured, or was terminated, forfeited, or surrendered in full or in part?
- No – Go to question 23 Forestry managed investment scheme income 2024.
- Yes – Read on.
What you need to complete this question
You will need your:
- Life insurance policy and bonus advice.
- Friendly society policy and bonus advice.
Completing your supplementary tax return
Write at question 22 – label W in your supplementary tax return:
- the whole bonus amount you received in 2023–24 if you received it during the first 8 years of the policy
- two-thirds of the bonus amount you received in 2023–24 if you received it during the 9th year of the policy, or
- one-third of the bonus amount you received in 2023–24 if you received it during the 10th year of the policy.
Don't show cents.
Don't include any bonus amount received after the 10th year of the policy.
Check before moving to the next question
Check that you have:
- written in your tax return the correct bonus amount
- kept a copy of your policy document and bonus advice with your other records, don't attach them to your tax return.
You will get a tax offset equal to 30% of the amount you show at this question. We will work out this tax offset for you.
Where to go next
- Go to question 23 Forestry managed investment scheme income 2024.
- Return to main menu Individual tax return instructions 2024.
- Go back to question 21 Rent 2024.