Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-1 - CAPITAL GAINS AND LOSSES: GENERAL TOPICS  

Division 118 - Exemptions  

Subdivision 118-A - General exemptions  

Exempt or loss-denying transactions

SECTION 118-37   Compensation, damages etc.  

118-37(1)    
A *capital gain or *capital loss you make from a *CGT event relating directly to any of these is disregarded:

(a) compensation or damages you receive for:

(i) any wrong or injury you suffer in your occupation; or

(ii) any wrong, injury or illness you or your *relative suffers personally;

(b) compensation or damages you receive as the trustee of a trust (other than a trust that is a *complying superannuation entity) for:

(i) any wrong or injury a beneficiary of the trust suffers in his or her occupation; or

(ii) any wrong, injury or illness a beneficiary of the trust, or the beneficiary ' s relative, suffers personally;

(ba) a *CGT asset you receive, as a beneficiary of a trust, from the trustee of the trust to the extent that the CGT asset is attributable to compensation or damages that the trustee receives as described in paragraph (b) for:

(i) any wrong or injury you suffer in your occupation; or

(ii) any wrong, injury or illness you or your relative suffers personally;

(c) gambling, a game or a competition with prizes;

(d) (Repealed by No 13 of 2014)

(e) (Repealed by No 123 of 2008)

(f) (Repealed by No 109 of 2014)

(g) a tobacco industry exit grant that you receive under the program known as the Tobacco Growers Adjustment Assistance Programme 2006 if, as a condition of receiving the grant, you entered into an undertaking not to become the owner or operator of any agricultural *enterprise within 5 years after receiving the grant;

(ga) a * water entitlement, to the extent that the CGT event happens because an entity * derives a * SRWUIP payment that is * non-assessable non-exempt income under section 59-65 ;

(gb) a * SRWUIP payment you derive that is non-assessable non-exempt income under section 59-65 ;

(h) a right or entitlement to a *tax offset, a *deduction, or a similar benefit under an *Australian law, a *foreign law or a law of part of a foreign country;

(i) a variation, transfer or revocation of an allocation (within the meaning of the National Rental Affordability Scheme Act 2008 );

(j) anything of economic value provided to you (whether directly or indirectly, such as through an *NRAS consortium of which you are a *member) by:

(i) a Department of a State or Territory; or

(ii) a body (whether incorporated or not) established for a public purpose by or under a law of a State or Territory;

in relation to your participation in the *National Rental Affordability Scheme.

118-37(2)    

A *capital gain or *capital loss is disregarded if you make it as a result of receiving a payment or property as reimbursement or payment of your expenses, or receiving or using a voucher or certificate, under:

(a) a scheme established by an *Australian government agency, a *local governing body or a *foreign government agency under an enactment or an instrument of a legislative character; or

(b) the General Practice Rural Incentives Program or the Rural and Remote General Practice Program; or

(c) the Sydney Aircraft Noise Insulation Project; or

(d) the M4/M5 Cashback Scheme; or

(e) the Unlawful Termination Assistance Scheme or the Alternative Dispute Resolution Assistance Scheme.

118-37(3)    

A *capital gain you make from compensation you receive under the *firearms surrender arrangements is disregarded.

118-37(4)    

A *capital gain or *capital loss you make from a payment you receive is disregarded if:

(a) you are an Australian resident; and

(b) you receive the payment:

(i) under the program known as the " German Forced Labour Compensation Programme " ; and

(ii) from the Foundation known as " Remembrance, Responsibility and Future " or any of the Foundation ' s partner organisations; and

(c) the payment is in the nature of compensation for:

(i) any wrong or injury; or

(ii) any loss of, or damage to, property;

that you, or another person, suffered as a result of injustices committed during the National Socialist period.

118-37(5)    

A *capital gain or *capital loss you make as a result of receiving a payment or property is disregarded if:

(a) you are an individual who is an Australian resident; and

(b) you receive the payment or property from a source in a foreign country; and

(c) you do not receive the payment or property directly or indirectly from an *associate of yours; and

(d) the payment or property you receive is in connection with:

(i) any wrong or injury; or

(ii) any loss of, or damage to, property; or

(iii) any other detriment;

that you, or another individual, suffered as a result of:

(iv) persecution by the National Socialist regime of Germany during the National Socialist period; or

(v) persecution by any other enemy of the Commonwealth during the Second World War; or

(vi) persecution by an enemy-associated regime during the Second World War; or

(vii) flight from persecution mentioned in subparagraph (iv), (v) or (vi); or

(viii) participation in a resistance movement during the Second World War against forces of the National Socialist regime of Germany; or

(ix) participation in a resistance movement during the Second World War against forces of any other enemy of the Commonwealth.

118-37(6)    

For the purposes of subsection (5), the duration of the Second World War includes:

(a) the period immediately before the Second World War; and

(b) the period immediately after the Second World War.

118-37(7)    

For the purposes of subsection (5), a regime is an enemy-associated regime if, and only if, it was:

(a) in alliance with; or

(b) occupied by; or

(c) effectively controlled by; or

(d) under duress from; or

(e) surrounded by;

either or both of the following:

(f) the National Socialist regime of Germany;

(g) any other enemy of the Commonwealth.

118-37(8)    

Subsection (5) applies to a payment or property received by the *legal personal representative of an individual in a corresponding way to the way in which that subsection would have applied if the payment or property had been received by the individual.

118-37(9)    

Subsection (5) applies to a payment or property received by:

(a) the *legal personal representative of a deceased individual; or

(b) the trustee of a trust established by the will of a deceased individual;

in a corresponding way to the way in which that subsection would have applied if:

(c) the individual had not died; and

(d) the payment or property had been received by the individual.