Taxation Ruling

TR 1999/6A2 - Addendum

Income tax and fringe benefits tax: flight rewards received under frequent flyer and other similar consumer loyalty programs

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Addendum

This Addendum amends Taxation Ruling TR 1999/6 to reflect the changes to the law caused by the repeal of inoperative provisions.

TR 1999/6 is amended as follows:

1. Subparagraph 4(b)

Omit '('the Act')'; substitute '(ITAA 1997)^[1A]'.

2. Paragraph 17

(a)

Omit 'of the Act'.

(b)

Omit 'the 1936 Act'; substitute 'ITAA 1936'.

(c)

Omit 'paragraph 26(e) of the 1936 Act'; substitute 'section 15-2 of the ITAA 1997 (formerly paragraph 26(e) of the ITAA 1936)'.

3. Paragraph 19

Omit '1936 Act'; substitute 'ITAA 1936'.

4. Paragraph 20

Omit first sentence; substitute:

In the High Court decisions of Hayes v. FC of T (1956) 96 CLR 47; (1956) 11 ATD 68 and Scott v. FC of T (1966) 117 CLR 514, the learned justices commented that before an amount can be brought within paragraph 26(e) of the ITAA 1936 (now section 15-2 of the ITAA 1997), it must first fall within subsection 25(1) (now section 6-5 of the ITAA 1997) as ordinary income.

5. Paragraph 21

Omit 'paragraph 26(e) of the 1936 Act. Paragraph 26(e)'; substitute 'section 10-5 and in turn section 15-2. Section 15-2'.

6. Paragraph 22

Omit the paragraph; substitute:

Business taxpayers

21A(5) [of the ITAA 1936] In this section: ...

'non-cash business benefit' means property or services provided ...

(a)

wholly or partly in respect of a business relationship ; or

(b)

wholly or partly for or in relation directly or indirectly to a business relationship (emphasis added).

Employees (where FBT does not apply)

26 [of the ITAA 1936] ... the assessable income of a taxpayer shall include - ...

(e)

the value to the taxpayer of all ... benefits ... allowed, given or granted to him in respect of , or for or in relation directly or indirectly to, any employment of or services rendered by him ...' (emphasis added).

Employees (where FBT does not apply)

15-2(1) [of the ITAA 1997] Your assessable income includes the value to you of all ... benefits, ... *provided to you in respect of, or for or in relation directly or indirectly to, any employment of or services rendered by you ...

15-2(2) This is so whether the things were *provided in money or in any other form (emphasis added).

7. Paragraph 24

Omit '1936 Act'; substitute 'ITAA 1936 (now section 15-2 of the ITAA 1997)'.

8. Paragraph 25

After 'paragraph 26(e)', insert 'of the ITAA 1936 (now section 15-2 of the ITAA 1997)'.

9. Paragraph 27

Omit 'whereas paragraph 26(e) of the 1936 Act (the equivalent Australian provision)'; substitute 'whereas former paragraph 26(e) of the ITAA 1936 (the equivalent Australian provision now section 15-2 of the ITAA 1997)'.

10. Paragraph 28

After 'given or granted' insert '(and its equivalent in section 15-2 -'provided'),'.

11. Paragraph 29

(a)

Omit 'of the Act'; substitute 'of the ITAA 1997'.

(b)

Omit 'subsection 25(1) of the 1936 Act'; substitute 'former subsection 25(1) of the ITAA 1936'.

12. Legislative references

Insert 'ITAA 1997 15-2'.

This Addendum applies on and from 14 September 2006.

Commissioner of Taxation
17 August 2011

References

ATO references:
NO 1-236MTTJ