Income Tax Assessment Act 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-15 - NON-ASSESSABLE INCOME  

Division 51 - Exempt amounts  

SECTION 51-32   Compensation payments for loss of tax exempt payments  

51-32(1)    
A compensation payment for the loss of pay or an allowance for your warlike service is exempt from income tax if:

(a) the compensation payment is made under the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 in respect of an injury (as defined in that Act) you suffered; and

(b) you suffered your injury while covered by a certificate in force under paragraph 23AD(1)(a) of the Income Tax Assessment Act 1936 ; and

(c) your injury or disease caused the loss of your pay or allowance; and

(d) your pay or allowance was payable under the Defence Act 1903 or under a determination under that Act.

51-32(2)    
A compensation payment for the loss of pay or an allowance for your warlike service is exempt from income tax if:

(a) the compensation payment is made under the Military Rehabilitation and Compensation Act 2004 in respect of a service injury or disease (as defined in that Act); and

(b) you sustained your service injury or contracted your service disease, or your service injury or disease was aggravated or materially contributed to, while covered by a certificate in force under paragraph 23AD(1)(a) of the Income Tax Assessment Act 1936 ; and

(c) your injury or disease caused the loss of your pay or allowance; and

(d) your pay or allowance was payable under the Defence Act 1903 or under a determination under that Act.

51-32(3)    

Subsections (4) and (5) apply to:

(a) a deployment allowance; or

(b) some other allowance that is exempt from income tax specified in writing by the *Defence Minister for the purposes of this subsection;

that is payable under a determination under the Defence Act 1903 for your non-warlike service.

51-32(4)    
A compensation payment for the loss of the allowance is exempt from income tax if:

(a) the compensation payment is made under the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 in respect of an injury (as defined in that Act) you suffered; and

(b) your injury caused the loss of your allowance.

51-32(5)    
A compensation payment for the loss of the allowance is exempt from income tax if:

(a) the compensation payment is made under the Military Rehabilitation and Compensation Act 2004 in respect of a service injury or disease (as defined in that Act); and

(b) your injury or disease caused the loss of your allowance.