Treasury Laws Amendment (2019-20 Bushfire Tax Assistance) Act 2020 (1 of 2020)

Schedule 1   Bushfire assistance

Income Tax Assessment Act 1997

2   After section 59-50

Insert:

59-55 2019-20 bushfires - payments for volunteer work with fire services

(1) A payment to an individual is not assessable income and is not *exempt income if:

(a) the purpose of the payment is to compensate the individual for the loss of income as a result of the individual performing volunteer work with a fire service (however described) of a State or Territory; and

(b) the work is performed during the 2019-20 income year; and

(c) the payment is made by a State or Territory and is covered by an agreement between the Commonwealth and that State or Territory; and

(d) the payment is made on or after 1 January 2020.

(2) However, this section does not apply to:

(a) a payment received in the individual's capacity as an employee or contractor (including a payment of an entitlement to paid leave); or

(b) a workers' compensation payment.

59-60 2019-20 bushfires - disaster relief payments and non-cash benefits

(1) A payment made to an entity, or a *non-cash benefit provided to an entity, to the extent it would otherwise be assessable income of the entity, is not assessable income and is not *exempt income if:

(a) the payment has been made or the benefit provided directly as a result of the bushfires commencing in Australia in the 2019-20 financial year; and

(b) the purpose of the payment or benefit is to provide the entity with relief from, or assist the entity in recovering from, the effects of the bushfires; and

(c) the payment is made, or the benefit is provided, by:

(i) the Commonwealth; or

(ii) a State or Territory; or

(iii) a municipal corporation; or

(iv) a *local governing body.

Note: Payments covered by this subsection would include Disaster Recovery Allowance paid under the Social Security Act 1991 and payments made under disaster recovery funding arrangements made by or on behalf of the Commonwealth.

(2) A payment made to an entity, or a *non-cash benefit provided to an entity, to the extent it would otherwise be assessable income of the entity, is also not assessable income and is not *exempt income if:

(a) the payment or benefit relates to the bushfires commencing in Australia in the 2019-20 financial year; and

(b) the payment or benefit is of a kind prescribed by the regulations for the purposes of this subsection.

(3) However, this section does not apply to:

(a) a payment or benefit received in an individual's capacity as an employee or contractor (including a payment of an entitlement to paid leave); or

(b) a workers' compensation payment; or

(c) a payment of compensation or damages made to an entity as a result of an order of a court or tribunal or settlement of a claim.