Income Tax Assessment Act 1997

CHAPTER 1 - INTRODUCTION AND CORE PROVISIONS  

PART 1-1 - PRELIMINARY  

Division 1 - Preliminary  

SECTION 1-1  

1-1   Short title  
This Act may be cited as the Income Tax Assessment Act 1997 .

SECTION 1-2  

1-2   Commencement  
This Act commences on 1 July 1997.

SECTION 1-3   Differences in style not to affect meaning  

1-3(1)    
This Act contains provisions of the Income Tax Assessment Act 1936 in a rewritten form.

1-3(2)    
If:

(a) that Act expressed an idea in a particular form of words; and

(b) this Act appears to have expressed the same idea in a different form of words in order to use a clearer or simpler style;

the ideas are not to be taken to be different just because different forms of words were used.

Note:

A public or private ruling about a provision of the Income Tax Assessment Act 1936 is taken also to be a ruling about the corresponding provision of this Act, so far as the 2 provisions express the same ideas: see section 357-85 in Schedule 1 to the Taxation Administration Act 1953 .

SECTION 1-4  

1-4   Application  

This Act extends to every external Territory referred to in the definition of Australia .

SECTION 1-7  

1-7   Administration of this Act  

The Commissioner has the general administration of this Act.

Note:

An effect of this provision is that people who acquire information under this Act are subject to the confidentiality obligations and exceptions in Division 355 in Schedule 1 to the Taxation Administration Act 1953 .

PART 1-2 - A GUIDE TO THIS ACT  

Division 2 - How to use this Act  

Subdivision 2-A - How to find your way around  

SECTION 2-1  

2-1   The design  
This Act is designed to help you identify accurately and quickly the provisions that are relevant to your purpose in reading the income tax law.

The Act contains tables, diagrams and signposts to help you navigate your way.

You can start at Division 3 (What this Act is about) and follow the signposts as far into the Act as you need to go. You may also encounter signposts to several areas of the law that are relevant to you. Each one should be followed.

Sometimes they will lead down through several levels of detail. At each successive level, the rules are structured in a similar way. They will often be preceded by a Guide to the rules at that level. The rules themselves will usually deal first with the general or most common case and then with the more particular or special cases.

Subdivision 2-B - How the Act is arranged  

SECTION 2-5  

2-5   The pyramid  

This Act is arranged in a way that reflects the principle of moving from the general case to the particular.

In this respect, the conceptual structure of the Act is something like a pyramid. The pyramid shape illustrates the way the income tax law is organised, moving down from the central or core provisions at the top of the pyramid, to general rules of wide application and then to the more specialised topics.

Note:

The Taxation Administration Act 1953 contains the provisions on collection and recovery of tax and provisions on administration.

Subdivision 2-C - How to identify defined terms and find the definitions  

SECTION 2-10   When defined terms are identified  

2-10(1)    
Many of the terms used in the income tax law are defined.

2-10(2)    
Most defined terms in this Act are identified by an asterisk appearing at the start of the term: as in `` ^* business''. The footnote that goes with the asterisk contains a signpost to the Dictionary definitions starting at section 995-1 .

SECTION 2-15   When terms are not identified  

2-15(1)    
Once a defined term has been identified by an asterisk, later occurrences of the term in the same subsection are not usually asterisked.

2-15(2)    
Terms are not asterisked in the non-operative material contained in this Act.

Note:

The non-operative material is described in Subdivision 2-E .

2-15(3)    

The following basic terms used throughout the Act are not identified with an asterisk. They fall into 2 groups:

Key participants in the income tax system

Item	This term:	is defined in:
1.	Australian resident	section 995-1
.
2.	Commissioner	section 995-1
.
3.	company	section 995-1
.
4.	entity	section 960-100
.
4A.	foreign resident	section 995-1
.
5.	individual	section 995-1
.
6.	partnership	section 995-1
.
7.	person	section 995-1
.
8.	trustee	section 995-1
.
9.	you	section 4-5

Core concepts

Item	This term:	is defined in:
1.	amount	section 995-1
.
2.	assessable income	Division 6
.
3.	assessment	section 995-1
.
3A.	Australia	Subdivision 960-T
.
4.	deduct, deduction	Division 8
.
5.	income tax	section 995-1
.
6.	income year	section 995-1
.
7.	taxable income	section 4-15
.
8.	this Act	section 995-1

SECTION 2-20  

2-20   Identifying the defined term in a definition  
Within a definition, the defined term is identified by bold italics .

Subdivision 2-D - The numbering system  

SECTION 2-25  

2-25   Purposes  
Two main purposes of the numbering system in this Act are:

• To indicate the relationship between units at different levels.

For example, the number of Part 2-15 indicates that the Part is in Chapter 2. Similarly, the number of section 165-70 indicates that the section is in Division 165 .

• To allow for future expansion of the Act. The main technique here is leaving gaps between numbers.

SECTION 2-30  

2-30   Gaps in the numbering  

There are gaps in the numbering system to allow for the insertion of new Divisions and sections.

Subdivision 2-E - Status of Guides and other non-operative material  

SECTION 2-35  

2-35   Non-operative material  
In addition to the operative provisions themselves, this Act contains other material to help you identify accurately and quickly the provisions that are relevant to you and to help you understand them.

This other material falls into 2 main categories.

SECTION 2-40  

2-40   Guides  
The first is the ``Guides''. A Guide consists of sections under a heading indicating that what follows is a Guide to a particular Subdivision, Division etc.

Guides form part of this Act but are kept separate from the operative provisions. In interpreting an operative provision, a Guide may only be considered for limited purposes. These are set out in section 950-150 .

SECTION 2-45  

2-45   Other material  
The other category consists of material such as notes and examples. These also form part of the Act. They are distinguished by type size from the operative provisions, but are not kept separate from them.

Division 3 - What this Act is about  

3-1   (Repealed) SECTION 3-1 What this Act is about  
(Repealed by No 41 of 2011)

SECTION 3-5   Annual income tax  

3-5(1)    
Income tax is payable for each year by each individual and company, and by some other entities.

Note 1:

Individuals who are Australian residents, and some trustees, are also liable to pay Medicare levy for each year. See the Medicare Levy Act 1986 and Part VIIB of the Income Tax Assessment Act 1936 .

Note 2:

Income tax is imposed by the Income Tax Act 1986 and the other Acts referred to in the definition of income tax in section 995-1 .

3-5(2)    
Most entities have to pay instalments of income tax before the income tax they actually have to pay can be worked out.

3-5(3)    

This Act answers these questions:

1. What instalments of income tax do you have to pay? When and how do you pay them?

See Schedule 1 to the Taxation Administration Act 1953 .

2. How do you work out how much income tax you must pay?

See Division 4 , starting at section 4-1 .

3. What happens if your income tax is more than the instalments you have paid? When and how must you pay the rest?

See Division 5 of this Act and Part 4-15 in Schedule 1 to the Taxation Administration Act 1953 .

4. What happens if your income tax is less than the instalments you have paid? How do you get a refund?

See Division 3A of Part IIB of the Taxation Administration Act 1953 .

5. What are your other obligations as a taxpayer, besides paying instalments and the rest of your income tax?

See section 3-10 .

6. Do you have any other obligations under the income tax law?

See section 3-15 .

7. If a dispute between you and the Commissioner of Taxation cannot be settled by agreement, what procedures for objection, review and appeal are available?

See Part IVC (sections 14ZL to 14ZZS ) of the Taxation Administration Act 1953 .

SECTION 3-10   Your other obligations as a taxpayer  

3-10(1)    
Besides paying instalments and the rest of your income tax, your main obligations as a taxpayer are:

(a) to keep records and provide information as required by:

• the Income Tax Assessment Act 1936 ; and

• Division 900 (which sets out substantiation rules) of this Act; and

(b) to lodge income tax returns as required by:

• the Income Tax Assessment Act 1936 .

Tax file numbers

3-10(2)    
Under Part VA of the Income Tax Assessment Act 1936 , a tax file number can be issued to you. You are not obliged to apply for a tax file number. However, if you do not quote one in certain situations:

• you may become liable for instalments of income tax that would not otherwise have been payable;

• the amount of certain of your instalments of income tax may be increased.

SECTION 3-15  

3-15   Your obligations other than as a taxpayer  
Your main obligations under the income tax law, other than as a taxpayer are:

• in certain situations, to deduct from money you owe to another person, and to remit to the Commissioner, instalments of income tax payable by that person.

See Part 4-5 (Collection of income tax instalments), starting at section 750-1.

PART 1-3 - CORE PROVISIONS  

Division 4 - How to work out the income tax payable on your taxable income  

SECTION 4-1  

4-1   Who must pay income tax  
Income tax is payable by each individual and company, and by some other entities.

Note:

The actual amount of income tax payable may be nil.

For a list of the entities that must pay income tax, see Division 9 , starting at section 9-1 .

SECTION 4-5  

4-5   Meaning of you  
If a provision of this Act uses the expression you , it applies to entities generally, unless its application is expressly limited.

Note 1:

The expression you is not used in provisions that apply only to entities that are not individuals.

Note 2:

For circumstances in which the identity of an entity that is a managed investment scheme for the purposes of the Corporations Act 2001 is not affected by changes to the scheme, see Subdivision 960-E of the Income Tax (Transitional Provisions) Act 1997 .

SECTION 4-10   How to work out how much income tax you must pay  

4-10(1)    

You must pay income tax for each *financial year.

4-10(2)    
Your income tax is worked out by reference to your taxable income for the income year . The income year is the same as the *financial year, except in these cases:

(a) for a company, the income year is the previous financial year;

(b) if you have an accounting period that is not the same as the financial year, each such accounting period or, for a company, each previous accounting period is an income year.

Note 1:

The Commissioner can allow you to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936 .

Note 2:

An accounting period ends, and a new accounting period starts, when a partnership becomes, or ceases to be, a VCLP, an ESVCLP, an AFOF or a VCMP. See section 18A of the Income Tax Assessment Act 1936 .

4-10(3)    

Work out your income tax for the *financial year as follows:

Income tax   =   (Taxable income   ×   Rate)   −   Tax offsets

Method statement

Note 1:

Division 63 explains what happens if your tax offsets exceed your basic income tax liability. How the excess is treated depends on the type of tax offset.

Note 2:

Section 4-11 of the Income Tax (Transitional Provisions) Act 1997 (which is about the temporary budget repair levy) may increase the amount of income tax worked out under this section.

4-10(3A)    
(Repealed by No 58 of 2006 )

Income tax worked out on another basis

4-10(4)    
For some entities, some or all of their income tax for the ^* financial year is worked out by reference to something other than taxable income for the income year.

See section 9-5 .

SECTION 4-15   How to work out your taxable income  

4-15(1)    
Work out your taxable income for the income year like this:

Taxable income   =   Assessable income   −   Deductions

Method statement

Note:

If the deductions exceed the assessable income, you may have a tax loss which you may be able to utilise in that or a later income year: see Division 36 .

4-15(2)    

There are cases where taxable income is worked out in a special way:

Item	For this case …	See:
1.	A company does not maintain continuity of ownership and control during the income year and does not satisfy the business continuity test	Subdivision 165-B
1A.	(Repealed by No 80 of 2007 )
1B.	An entity is a *member of a *consolidated group at any time in the income year	Part 3-90
2.	A company becomes a PDF (pooled development fund) during the income year, and the PDF component for the income year is a nil amount	section 124ZTA of the Income Tax Assessment Act 1936
3.	A shipowner or charterer: • has its principal place of business outside Australia; and	section 129 of the Income Tax Assessment Act 1936
	• carries passengers, freight or mail shipped in Australia
4.	An insurer who is a foreign resident enters into insurance contracts connected with Australia	sections 142 and 143 of the Income Tax Assessment Act 1936
5.	The Commissioner makes a default or special assessment of taxable income	sections 167 and 168 of the Income Tax Assessment Act 1936
6.	The Commissioner makes a determination of the amount of taxable income to prevent double taxation in certain treaty cases	section 24 of the International Tax Agreements Act 1953

Note:

A life insurance company can have a taxable income of the complying superannuation class and/or a taxable income of the ordinary class for the purposes of working out its income tax for an income year: see Subdivision 320-D .

SECTION 4-25  

4-25   Special provisions for working out your basic income tax liability  

Subsection 392-35(3) may increase your basic income tax liability beyond the liability worked out simply by applying the income tax rates to your taxable income.

Note:

Subsection 392-35(3) increases some primary producers ' tax liability by requiring them to pay extra income tax on their averaging components worked out under Subdivision 392-C .

Division 5 - How to work out when to pay your income tax  

Guide to Division 5  

SECTION 5-1   What this Division is about  

Subdivision 5-A - How to work out when to pay your income tax  

SECTION 5-5   When income tax is payable  

Scope

5-5(1)    
This section tells you when income tax you must pay for a *financial year is due and payable.

Note:

The Commissioner may defer the time at which the income tax is due and payable: see section 255-10 in Schedule 1 to the Taxation Administration Act 1953 .

5-5(2)    
The income tax is only due and payable if the Commissioner makes an *assessment of your income tax for the year.

5-5(3)    
However, if the Commissioner does make an *assessment of your income tax for the year, the tax may be taken to have been due and payable at a time before your assessment was made.

Note:

This is to ensure that general interest charge begins to accrue from the same date for all like entities. General interest charge on unpaid income tax is calculated from when the tax is due and payable, not from when the assessment is made: see section 5-15 .

Original assessments - self-assessment entities

5-5(4)    
If you are a *self-assessment entity, the income tax is due and payable on the first day of the sixth month after the end of the income year.

Example:

If your income year is the same as the financial year, your income tax would be due and payable on 1 December.

Original assessments - other entities

5-5(5)    
If you are not a *self-assessment entity, the income tax is due and payable 21 days after the day (the return day ) on or before which you are required to lodge your *income tax return with the Commissioner.

Note:

For rules about income tax returns and when they are due, see Part IV of the Income Tax Assessment Act 1936 .

5-5(6)    
However, if you lodge your return on or before the return day and the Commissioner gives you a notice of *assessment (other than an amended assessment) after the return day, the income tax is due and payable 21 days after the Commissioner gives you the notice.

Amended assessments

5-5(7)    
If the Commissioner amends your *assessment, any extra income tax resulting from the amendment is due and payable 21 days after the day on which the Commissioner gives you notice of the amended assessment.

Note:

Shortfall interest charge may be payable, on any amount of extra income tax payable as a result of the amended assessment, for each day in the period that:

(a) starts at the time income tax was due and payable on your original assessment; and

(b) ends the day before the day on which the Commissioner gives you notice of the amended assessment.

SECTION 5-10  

5-10   When shortfall interest charge is payable  

An amount of *shortfall interest charge that you are liable to pay is due and payable 21 days after the day on which the Commissioner gives you notice of the charge.

Note:

Shortfall interest charge is imposed if the Commissioner amends an assessment and the amended assessment results in an increase in some tax payable. For provisions about liability for shortfall interest charge, see Division 280 in Schedule 1 to the Taxation Administration Act 1953 .

SECTION 5-15  

5-15   General interest charge payable on unpaid income tax or shortfall interest charge  

If an amount of income tax or *shortfall interest charge that you are liable to pay remains unpaid after the time by which it is due to be paid, you are liable to pay the *general interest charge on the unpaid amount for each day in the period that:

(a) starts at the beginning of the day on which the amount was due to be paid; and

(b) finishes at the end of the last day on which, at the end of the day, any of the following remains unpaid:

(i) the income tax or shortfall interest charge;

(ii) general interest charge on any of the income tax or shortfall interest charge.

Note 1:

The general interest charge is worked out under Part IIA of the Taxation Administration Act 1953 .

Note 2:

Shortfall interest charge is worked out under Division 280 in Schedule 1 to that Act.

Division 6 - Assessable income and exempt income  

Guide to Division 6  

SECTION 6-1   Diagram showing relationships among concepts in this Division  

6-1(1)    
Assessable income consists of ordinary income and statutory income.

6-1(2)    
Some ordinary income, and some statutory income, is exempt income.

6-1(3)    
Exempt income is not assessable income.

6-1(4)    
Some ordinary income, and some statutory income, is neither assessable income nor exempt income.

For the effect of the GST in working out assessable income, see Division 17 .

6-1(5)    
An amount of ordinary income or statutory income can have only one status (that is, assessable income, exempt income or non-assessable non-exempt income) in the hands of a particular entity.

Operative provisions

SECTION 6-5   Income according to ordinary concepts ( ordinary income )  

6-5(1)    
Your assessable income includes income according to ordinary concepts, which is called ordinary income .

Note:

Some of the provisions about assessable income listed in section 10-5 may affect the treatment of ordinary income.

6-5(2)    
If you are an Australian resident, your assessable income includes the ^* ordinary income you ^* derived directly or indirectly from all sources, whether in or out of Australia, during the income year.

6-5(3)    

If you are a foreign resident, your assessable income includes:

(a) the ^* ordinary income you ^* derived directly or indirectly from all ^* Australian sources during the income year; and

(b) other ^* ordinary income that a provision includes in your assessable income for the income year on some basis other than having an ^* Australian source.

6-5(4)    
In working out whether you have derived an amount of ^* ordinary income, and (if so) when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct.

SECTION 6-10   Other assessable income ( statutory income )  

6-10(1)    
Your assessable income also includes some amounts that are not ^* ordinary income.

Note:

These are included by provisions about assessable income. For a summary list of these provisions, see section 10-5 .

6-10(2)    
Amounts that are not ^* ordinary income, but are included in your assessable income by provisions about assessable income, are called statutory income .

Note 1:

Although an amount is statutory income because it has been included in assessable income under a provision of this Act, it may be made exempt income or non-assessable non-exempt income under another provision: see sections 6-20 and 6-23 .

Note 2:

Many provisions in the summary list in section 10-5 contain rules about ordinary income. These rules do not change its character as ordinary income.

6-10(3)    
If an amount would be ^* statutory income apart from the fact that you have not received it, it becomes statutory income as soon as it is applied or dealt with in any way on your behalf or as you direct.

6-10(4)    
If you are an Australian resident, your assessable income includes your ^* statutory income from all sources, whether in or out of Australia.

6-10(5)    

If you are a foreign resident, your assessable income includes:

(a) your ^* statutory income from all ^* Australian sources; and

(b) other ^* statutory income that a provision includes in your assessable income on some basis other than having an ^* Australian source.

SECTION 6-15   What is not assessable income  

6-15(1)    
If an amount is not ^* ordinary income, and is not ^* statutory income, it is not assessable income (so you do not have to pay income tax on it).

6-15(2)    
If an amount is ^* exempt income, it is not assessable income .

Note:

If an amount is exempt income, there are other consequences besides it being exempt from income tax. For example:

• the amount may be taken into account in working out the amount of a tax loss (see section 36-10 );

• you cannot deduct as a general deduction a loss or outgoing incurred in deriving the amount (see Division 8 );

• capital gains and losses on assets used solely to produce exempt income are disregarded (see section 118-12 ).

6-15(3)    

If an amount is ^* non-assessable non-exempt income, it is not assessable income .

Note 1:

You cannot deduct as a general deduction a loss or outgoing incurred in deriving an amount of non-assessable non-exempt income (see Division 8 ).

Note 2:

Capital gains and losses on assets used to produce some types of non-assessable non-exempt income are disregarded (see section 118-12 ).

SECTION 6-20   Exempt income  

6-20(1)    

An amount of ^* ordinary income or ^* statutory income is exempt income if it is made exempt from income tax by a provision of this Act or another ^* Commonwealth law.

For summary lists of provisions about exempt income, see sections 11-5 and 11-15 .

6-20(2)    
^* Ordinary income is also exempt income to the extent that this Act excludes it (expressly or by implication) from being assessable income.

6-20(3)    

By contrast, an amount of ^* statutory income is exempt income only if it is made exempt from income tax by a provision of this Act outside this Division or another ^* Commonwealth law.

6-20(4)    

If an amount of ^* ordinary income or ^* statutory income is ^* non-assessable non-exempt income, it is not exempt income .

Note:

An amount of non-assessable non-exempt income is not taken into account in working out the amount of a tax loss.

SECTION 6-23  

6-23   Non-assessable non-exempt income  

An amount of ^* ordinary income or ^* statutory income is non-assessable non-exempt income if a provision of this Act or of another ^* Commonwealth law states that it is not assessable income and is not ^* exempt income.

Note:

Capital gains and losses on assets used to produce some types of non-assessable non-exempt income are disregarded (see section 118-12 ).

For a summary list of provisions about non-assessable non-exempt income, see Subdivision 11-B .

SECTION 6-25   Relationships among various rules about ordinary income  

6-25(1)    
Sometimes more than one rule includes an amount in your assessable income:

• the same amount may be ^* ordinary income and may also be included in your assessable income by one or more provisions about assessable income; or

• the same amount may be included in your assessable income by more than one provision about assessable income.

For a summary list of the provisions about assessable income, see section 10-5 .

However, the amount is included only once in your assessable income for an income year, and is then not included in your assessable income for any other income year.

6-25(2)    
Unless the contrary intention appears, the provisions of this Act (outside this Part) prevail over the rules about ^* ordinary income.

Note:

This Act contains some specific provisions about how far the rules about ordinary income prevail over the other provisions of this Act.

Division 8 - Deductions  

SECTION 8-1   General deductions  

8-1(1)    
You can deduct from your assessable income any loss or outgoing to the extent that:

(a) it is incurred in gaining or producing your assessable income; or

(b) it is necessarily incurred in carrying on a ^* business for the purpose of gaining or producing your assessable income.

Note:

Division 35 prevents losses from non-commercial business activities that may contribute to a tax loss being offset against other assessable income.

8-1(2)    
However, you cannot deduct a loss or outgoing under this section to the extent that:

(a) it is a loss or outgoing of capital, or of a capital nature; or

(b) it is a loss or outgoing of a private or domestic nature; or

(c) it is incurred in relation to gaining or producing your ^* exempt income or your ^* non-assessable non-exempt income; or

(d) a provision of this Act prevents you from deducting it.

For a summary list of provisions about deductions, see section 12-5 .

8-1(3)    
A loss or outgoing that you can deduct under this section is called a general deduction .

For the effect of the GST in working out deductions, see Division 27 .

Note:

If you receive an amount as insurance, indemnity or other recoupment of a loss or outgoing that you can deduct under this section, the amount may be included in your assessable income: see Subdivision 20-A .

SECTION 8-5   Specific deductions  

8-5(1)    
You can also deduct from your assessable income an amount that a provision of this Act (outside this Division) allows you to deduct.

8-5(2)    
Some provisions of this Act prevent you from deducting an amount that you could otherwise deduct, or limit the amount you can deduct.

8-5(3)    
An amount that you can deduct under a provision of this Act (outside this Division) is called a specific deduction .

Note:

If you receive an amount as insurance, indemnity or other recoupment of a deductible expense, the amount may be included in your assessable income: see Subdivision 20-A .

For a summary list of provisions about deductions, see section 12-5 .

SECTION 8-10  

8-10   No double deductions  
If 2 or more provisions of this Act allow you deductions in respect of the same amount (whether for the same income year or different income years), you can deduct only under the provision that is most appropriate.

PART 1-4 - CHECKLISTS OF WHAT IS COVERED BY CONCEPTS USED IN THE CORE PROVISIONS  

Division 9 - Entities that must pay income tax  

SECTION 9-1A  

9-1A   Effect of this Division  

This Division is a ^* Guide.

SECTION 9-1  

9-1   List of entities  

Income tax is payable by the entities listed in the table.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

Item	Income tax is payable by this kind of entity:	because of this provision:
1	An individual	section 4-1
2	A company, that is:	section 4-1
		• a body corporate; or
		• an unincorporated body (except a   partnership)
3	A company that was a member of a wholly-owned group if a former subsidiary in the group is treated as having disposed of leased plant and does not pay all of the income tax resulting from that treatment	section 45-25
3A	A company that is a corporate collective investment vehicle (CCIV)	Subdivision 195-C
3B	The trustee of an attribution managed investment trust (AMIT)	sections 276-405 to 276-425
4	A superannuation provider in relation to a complying superannuation fund	sections 295-5 and 295-605
5	A superannuation provider in relation to a non-complying superannuation fund	sections 295-5 and 295-605
6	A superannuation provider in relation to a complying approved deposit fund	section 295-5
7	A superannuation provider in relation to a non-complying approved deposit fund	section 295-5
8	The trustee of a pooled superannuation trust	section 295-5
8A	A sovereign entity	section 880-55
9	A corporate limited partnership	section 94J
10	A mutual insurance association (as described in section 121)	section 121
11	A trustee (except one covered by another item in this table), but only in respect of some kinds of income of the trust	sections 98 , 99 , 99A and 102
12	(Repealed by No 53 of 2016)
13	The trustee of a public trading trust	section 102S

SECTION 9-5   Entities that work out their income tax by reference to something other than taxable income  

9-5(1)    

For some entities, some or all of their income tax for the ^* financial year is worked out as described in the table.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

Item	This kind of entity is liable to pay income tax worked out by reference to:	See:
1	A company that was a member of a wholly-owned group is jointly and severally liable to pay an amount of income tax if a former subsidiary in the group is treated as having disposed of leased plant and does not pay all of the income tax resulting from that treatment.	section 45-25
.
1A	The trustee of an attribution managed investment trust (AMIT) is liable to pay income tax on certain amounts reflecting under-attribution of income or over-attribution of tax offsets	sections 276-405 to 276-425
.
2	A superannuation provider in relation to a complying superannuation fund is to be assessed and is liable to pay income tax on no-TFN contributions income as well as on taxable income.	sections 295-5 and 295-605
.
3	A superannuation provider in relation to a non-complying superannuation fund is to be assessed and is liable to pay income tax on no-TFN contributions income as well as on taxable income.	sections 295-5 and 295-605
.
4	An RSA provider is to be assessed and is liable to pay income tax on no-TFN contributions income as well as on taxable income.	sections 295-5 , 295-605 and 320-155
.
4A	(Repealed by No 92 of 2020)
.
5	An Australian resident individual with: • eligible foreign remuneration under section 23AF; or • foreign earnings under section 23AG; (from working in a foreign country) is liable to pay income tax worked out by reference to his or her assessable income less some of his or her deductions.	section 23AF or 23AG
.
6	A trustee covered by item 11 in the table in section 9-1 is liable to pay income tax worked out by reference to the net income of the trust for the income year.	sections 98 , 99 and 99A
.
7	(Repealed by No 53 of 2016)
.
8	The trustee of a public trading trust is liable to pay income tax worked out by reference to the net income of the trust for the income year.	section 102S
.
9	An entity that is liable to pay income tax (worked out by reference to taxable income or otherwise) is also liable to pay income tax worked out by reference to diverted income or diverted trust income for the income year.	section 121H
.
10	An Australian insurer that re-insures overseas can elect to pay, as agent for the re-insurer, income tax worked out by reference to the amount of the re-insurance premiums.	section 148

9-5(2)    
For entities covered by an item in the table in subsection (1) , the income year is the same as the ^* financial year, except in these cases:

(a)    for a company, or an entity covered by item 2 or 3 in the table, the income year is the previous financial year;

(b)    

if an entity has an accounting period that is not the same as the financial year, each such accounting period or, for a company, each previous accounting period is an income year.

Note 1:

The Commissioner can allow an entity to adopt an accounting period ending on a day other than 30 June. See section 18 of the Income Tax Assessment Act 1936 .

Note 2:

An accounting period ends, and a new accounting period starts, when a partnership becomes, or ceases to be, a VCLP, an ESVCLP, an AFOF or a VCMP. See section 18A of the Income Tax Assessment Act 1936 .

Division 10 - Particular kinds of assessable income  

SECTION 10-1  

10-1   Effect of this Division  

This Division is a ^* Guide.

SECTION 10-5  

10-5   List of provisions about assessable income  

The provisions set out in the table:

• include in your assessable income amounts that are not ^* ordinary income; and

• vary or replace the rules that would otherwise apply for certain kinds of ^* ordinary income.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

Accrued leave transfer payments	15-5
alienated personal services income	86-15
allowances
	see employment
annual leave
	see leave payments
annuities	27H
approved deposit fund (ADFs)
	see superannuation
attributable income
	see controlled foreign corporations
avoidance of tax
	general	177F
	diversion of income	121H
	see also transfers of income
bad debts
	see recoupment
balancing adjustment
	see capital allowances, investments, R & D, scientific research and tax exempt entities
banking
	offshore banking unit, deemed interest on payments to by owner	121EK
barter transactions	21 , 21A , 15-2
beneficiaries
	see trusts
benefits
	business, non-cash	21A
	consideration, non-cash	21
	meals you provide in an in-house dining facility	32-70
	see also employment and superannuation
bonus shares
	see shares
bounties	15-10
capital allowances
	excess of termination value over adjustable value
	generally	40-285
	for some cars	40-370
	depreciating asset in low-value pool	40-445(2)
	expenditure in software development pool	40-460
	recovery of petroleum resource rent tax	40-750(3)
capital gains	102-5
	see also insurance
car expenses
	cents per kilometres reimbursement of	15-70
carried interests
	carried interests, not ordinary income	118-21
CFCs
	see controlled foreign corporations
charters
	see shipping
child
	non-trust income of, unearned	102AE
	trust income of, unearned	102AG
collecting societies
	payments of royalties by copyright collecting societies	15-22
	payments of royalties by resale royalty collecting society	15-23
company
	see controlled foreign corporations, co-operative company, directors, dividends, liquidation, shareholders and shares
compensation
	live stock or trees, recoveries for loss of	385-130
	profits or income, insurance or indemnity for loss of	15-30
	received by lessor for lessee ' s non-compliance with lease obligation to repair	15-25
	trading stock, insurance or indemnity for loss of	70-115
	see also insurance, live stock, recoupment and scientific research
consideration
	see benefits
consolidated groups and MEC groups
	Assets in relation to Division 230 financial arrangement	701-61(3)
controlled foreign corporations (CFCs)
	attributable income of	456 to 459A
	see also dividends and taxes
co-operative company
	receipts of	119
credit union
	see co-operative company
currency gains
	see foreign exchange
currency losses
	see recoupment
death
	see trusts
debt/equity swap
	see shares and units
defence forces
	allowances and benefits for service as a member of	15-2
depreciation
	see capital allowances
directors
	excessive remuneration or retirement payment from company	109
distributions
	see dividends
dividends
	benefit of LIC capital gain through a trust or partnership	115-280
	general	44(1)
	distribution from a controlled foreign corporation	47A(1)
	franked dividends, credits on	207-20(1) , 207-35(1) , 207-35(3)
	see also liquidation
elections
	local government, reimbursement of expenses of	25-65
	see also recoupment
electricity connections
	see recoupment
[ eligible termination payments (ETPs)] (Repealed by No 15 of 2007)
employees
	see shares
employment
	allowances and benefits in relation to employment or rendering services	15-2
	employment termination payment	82-10 82-65 82-70
	other payments for employment termination	83-295
	return to work payments	15-3
	see accrued leave transfer payments, leave payments, superannuation and sections 82-10A and 82-10C of the Income Tax (Transitional Provisions) Act 1997
environment
	see recoupment
farm management deposits
	repayments of	393-10
[ FIFs] (Repealed by No 114 of 2010)
films
	Australian, proceeds of investment in	26AG
financial arrangements
	gains from	230-15(1)
[ first home saver accounts] (Repealed by No 70 of 2015)
foreign exchange
	gains	775-15
	see also recoupment
foreign income tax deduction for franked distributions
	Additional Tier 1 capital exception	15-80
foreign investment funds (FIFs) (Repealed by No 114 of 2010)
forestry agreement
	amount where section 82KZMG of the 1936 Act applies	15-45
	CGT event in relation to forestry interest in agreement	82KZMGB
forestry managed investment schemes
	forestry manager ' s receipts under scheme	15-46
	CGT event in relation to forestry interest in scheme for initial participant	394-25(2)
	CGT event in relation to forestry interest in scheme for subsequent participant	394-30(2)
franked dividends
	see dividends
funeral policy
	benefit under	15-55
general insurance companies and companies that self insure
	gross premiums	321-45
	reduction in value of adjusted liability for incurred claims	321-10
	reduction in value of adjusted liability for remaining coverage	321-50
	reduction in value of outstanding claims liability	321-80
geothermal energy
	providing geothermal exploration information	15-40
grapevines
	see recoupment
horticultural plants
	see recoupment
improvements
	see leases
imputation
	see dividends
indemnity
	see compensation and recoupment
[ industrial property] (Repealed by No 88 of 2013)
[ infrastructure borrowings] (Repealed by No 4 of 2018)
insurance
	bonuses	26AH , 15-75
	company, demutualisation of	121AT
	life insurance, transfer of contributions by superannuation fund or approved deposit fund to	295-260
	payments from a non-resident reinsurer in respect of a loss	148
	premiums in respect of Australian business received by non-resident insurers	143
	premiums paid to a non-resident for reinsurance	148
	premiums paid to mutual insurance association	121
	premiums payable to a non-resident for insurance of property in Australia	142(1)
	premiums payable to a non-resident for insuring an event that can only happen in Australia	142(1)
	premiums payable to a non-resident under an insurance contract with a resident	142(2)
	rebates and premiums refunded to a superannuation fund trustee	295-320 (table item 4)
	see also compensation, life insurance companies and recoupment
[ intellectual property] (Repealed by No 77 of 2001)
interest
	overpaid tax, on	15-35
	qualifying securities, on	159GQ , 159GW(1)
	see also co-operative companies and leases
investments
	prizes from investment-related lotteries	26AJ
	qualifying securities, payments to partial residents made under	159GW(2)
	qualifying securities, amount assessable to issuer of	159GT(1B)
	qualifying securities, balancing adjustment on the transfer of	159GS
	securities, variation in terms of	159GV(2)
	securities lending arrangements	26BC
	traditional securities, gains on the disposal or redemption of	26BB
	see also films and interest
landcare operations
	see recoupment
leased plant	Division 45
leases
	amounts received by lessor from lessee for non-compliance with lease obligation to repair	15-25
	interest component of payments under non-leveraged finance leases	159GK
	partnership leasing property under non-leveraged finance lease, new partner or contribution of capital since 14 May 1985	159GO
	premiums relating to assignment of a lease granted before 20 September 1985	26AB
	profit on disposal of previously leased motor vehicles	Subdivision 20-B
leases of luxury cars
	accrual amounts	242-35
	adjustment amounts (lessee)	242-70
	adjustment amounts (lessor)	242-65
leave payments
	accrued leave transfer payment	15-5
	unused annual leave payment	83-10
	unused long service leave payment	83-80
	see employment
[ life assurance companies ] (Repealed by No 89 of 2000)
life insurance companies	Subdivision 320-B
limited recourse debt
	excessive deduction amount (debtor)	243-40
	excessive deduction amount (partner)	243-65
liquidation
	distribution to a shareholder in winding up a company	47(1)
live stock
	death or destruction of	Subdivision 385-E
	departing Australia and	385-160 , 385-163
	insolvency, and	385-160 , 385-163
	profits on death or disposal of	Subdivision 385-E , 385-160
	see also compensation and trading stock
long service leave
	see leave payments
losses
	see compensation
lotteries
	see investments
managed investment trusts
	gains etc. from carried interests	275-200(2)
meals
	see benefits
[ minerals resource rent tax] (Repealed by No 96 of 2014)
Mining
	providing mining, quarrying or prospecting information	15-40
minors
	see child
motor vehicles
	see car expenses and leases
mutual insurance
	see insurance
non-cash benefits
	see benefits and employment
notional sales and loans
	adjustment amounts (lessee)	240-110(2)
	adjustment amounts (lessor)	240-105(2)
	notional interest	240-35(1)
	profit on actual sale	240-35(3)
	profit on notional sale	240-35(2)
offshore banking units
	see banking
partnerships
	net income of, partner ' s interest in	92(1)
	uncontrolled partnership income, effect of	94
	see also leases
[ payments to members of copyright collecting societies] (Repealed by No 126 of 2009)
petroleum
	resource rent tax, recovery of	20-30(1)
	see also capital allowances
[ pooled depreciated property] (Repealed by No 77 of 2001)
[ pooled software] (Repealed by No 77 of 2001)
premiums
	see insurance, leases and superannuation
primary production
	see recoupment
prizes
	see investments
profits
	cross-border transfer pricing	815-30
	profit-making undertaking or plan	15-15
	sale of property acquired before 20 September 1985 for profit-making by sale	25A
	see also avoidance of tax
Project pools
	An amount received for the abandonment, sale or other disposal of a project	40-830 , 40-832
property
	see profits and trusts
quarrying
	see mining and recoupment
R & D
	balancing adjustment	40-292 , 40-293 , 355-315 and 355-525
	disposal of R & D results	355-410
	recoupments and feedstock adjustments	355-450
rates
	see recoupment
recoupment
	insurance or indemnity for deductible losses or outgoings	Subdivision 20-A
	other recoupment for certain deductible losses or outgoings	Subdivision 20-A
	see also car expenses, compensation, elections and petroleum
registered emissions units
	disposal of	420-25
	disposal for a non-commercial purpose	420-40
	difference between opening and closing value of	420-45
reimbursements
	see car expenses, dividends, elections, petroleum and recoupment
reinsurance
	see insurance
[ repayments] (Repealed by No 66 of 2003)
[ research & development] (Repealed by No 93 of 2011)
[ residual value] (Repealed by No 88 of 2013)
retirement payments
	see directors, leave payments and shareholders
rights to income
	see transfers of income
roads
	see timber
royalties	15-20
schemes
	see avoidance of tax
scholarship plan
	benefit under	15-60
scientific research
	consideration for disposal or destruction of buildings acquired for scientific research	73A(4)
securities
	see investments
services
	see co-operative companies, employment, loans and trusts
shareholders
	excessive remuneration or retirement payment from company	109
	loans, payments and credits from company	Division 7A of Part III
	see also dividends
shares
	acquired in a debt/equity swap, profit on the disposal cancellation or redemption of	63E(4)
	bonus shares, cost of	6BA
	buy-backs	159GZZZJ to 159GZZZT
	employee share schemes	Subdivisions 83A-B and 83A-C
	holding company shares held by a subsidiary, cancellation of	159GZZZC to 159GZZZI
	see also dividends
shipping
	goods shipped in Australia, amounts paid to foreign shipowners and charterers for	129
[ small-medium enterprises (SMEs)] (Repealed by No 23 of 2018)
[ software] (Repealed by No 77 of 2001)
[ spectrum licences] (Repealed by No 77 of 2001)
subsidies	15-10
[ sugar industry exit grants] (Repealed by No 109 of 2014)
superannuation
	associated earnings on non-concessional contributions	Subdivision 292-B
	benefits generally	Divisions 301 to 306
	benefits in breach of legislative requirements	Division 304
	benefits received from older superannuation funds	26AF , 26AFA
	complying fund becomes non-complying, effect of	295-320 (table item 2)
	contributions to an approved deposit fund	Subdivisions 295-C and 295-D
	contributions to an RSA	Subdivision 295-C
	contributions to a superannuation fund	Subdivisions 295-C and 295-D
	death benefits	302-75 , 302-85 , 302-90 , 302-145
	excess concessional contributions	291-15(a)
	first home super saver scheme	313-20
	foreign superannuation funds and schemes, benefits from	305-70
	member benefits	301-20 , 301-25 , 301-35 , 301-40 , Subdivision 301-C
	foreign fund becoming Australian, effect of	295-320 (table item 3)
	no-TFN contributions income	295-605
	release authorities, payments from	304-20
	returned contributions	290-100
	trustee ' s liability to pay tax	295-5(2) and (3)
	see insurance
tax avoidance
	see avoidance of tax and transfers of income
tax exempt entities
	treatment of income and gains on becoming taxable	Schedule 2D
taxes
	see dividends, foreign investment funds, interest and recoupment
termination of employment
	see directors, eligible termination payments, leave payments and shareholders
theft
	see recoupment
[ timber] (Repealed by No 77 of 2001)
trading stock
	change in interests in	70-100
	death of trader and	70-105
	difference between opening and closing value of	70-35
	disposal not at arm ' s length	70-20
	disposal of outside ordinary course of business	70-90 , 70-95
	see also compensation and tax exempt entities
transfer pricing
	arm ' s length principle for cross-border conditions between entities	Subdivision 815-B
	arm ' s length principle for permanent establishments	Subdivision 815-C
transfers of income
	consideration for transfer of right to income	102CA
	payments for transfer or disposal of property	262
	transferee, effect on of transfer of right to income	102C
	transferor, effect on of transfer of right to income	102B
travel expenses
	see car expenses
trusts
	beneficiary under legal disability or with a vested and indefeasible interest in trust income	100
	deceased estates, income of	101A
	discretionary trusts	101
	net income of a trust estate, your present entitlement to	97 , 101
	non-resident beneficiaries, liability to tax of	98A
	non-resident trust estates to which you have transferred property or services, income of	102AAZD
	property of applied for benefit of beneficiaries	99B
	trust estate includes income from another trust estate	94(5)
	trustees ' liability to tax	98 , 99 , 99A , 102 , 102S
	see also avoidance of tax and superannuation
unearned income
	see child
units
	acquired in a debt/equity swap, profit on the disposal, cancellation or redemption of	63E(4)
water conservation
	see recoupment
winding-up
	see insurance and liquidation
wool clips
	double wool clips, treatment of	385-135 , 385-155
work in progress
	receipt of a work in progress amount	15-50

Division 11 - Particular kinds of non-assessable income  

Subdivision 11-A - Lists of classes of exempt income  

SECTION 11-1A  

11-1A   Effect of this Subdivision  

This Subdivision is a ^* Guide.

SECTION 11-1  

11-1   Overview  

Ordinary income or statutory income which is exempt from income tax can be divided into 2 main classes:

(a) ordinary or statutory income of entities that are exempt, no matter what kind of ordinary or statutory income they have (see table in section 11-5 );

(b) ordinary or statutory income of a kind that is exempt (see table in section 11-15 ).

(c) (Repealed by No 12 of 2012)

SECTION 11-5  

11-5   Entities that are exempt, no matter what kind of ordinary or statutory income they have  

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

Note:

Special rules apply to entities that cease to be exempt. See Schedule 2D to the Income Tax Assessment Act 1936 .

charity, education or science
	educational institution, public	50-5
	registered charity	50-5
	scientific institution	50-5
	scientific research fund	50-5
	scientific society etc.	50-5
community service
	community service society etc.	50-10
employees and employers
	employee association	50-15
	employer association	50-15
	trade union	50-15
[ film] (Repealed by No 41 of 2011)
[ funds established by will or trust] (Repealed by No 96 of 2013)
[ finance] (Repealed by No 101 of 2004)
government
	constitutionally protected fund	50-25
	local governing body	50-25
	municipal corporation	50-25
	public authority	50-25
	state/territory bodies	24AK to 24AZ
health
	health benefits organisation	50-30
	hospital	50-30
	medical benefits organisation	50-30
HIH rescue package
	HIH Claims Support Trust	322-10
mining
	British Phosphate Commissioners Banaba Contingency Fund	50-35
primary or secondary resources, and tourism
	agricultural society etc.	50-40
	aviation society etc.	50-40
	Global Infrastructure Hub Ltd	50-40
	horticultural society etc.	50-40
	industrial society etc.	50-40
	manufacturing society etc.	50-40
	pastoral society etc.	50-40
	tourism society etc.	50-40
	viticultural society etc.	50-40
sports, culture or recreation
	animal racing society etc.	50-45
	art society etc.	50-45
	F é d é ration Internationale de Football Association	50-45
	FWWC2023 Pty Ltd	50-45
	game society etc.	50-45
	ICC Business Corporation FZ-LLC	50-45
	literature society etc.	50-45
	music society etc.	50-45
	sport society etc.	50-45

11-10   (Repealed) SECTION 11-10 Ordinary or statutory income which is exempt, no matter whose it is  
(Repealed by No 12 of 2012)

SECTION 11-15  

11-15   Ordinary or statutory income which is exempt  

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

acute support packages for veterans and their families
	acute support packages for veterans and their families	52-185
agricultural industry exit grants
	tobacco industry exit grants	53-10
copyright collecting societies	51-43
Coronavirus economic response payment
	certain payments in accordance with the Coronavirus Economic Response Package (Payments and Benefits) Act 2020	53-25
credit unions
	interest	23G
defence
	Defence Force member, allowances	51-5
	Defence Force member, compensation payments for loss of deployment allowance for warlike service	51-5
	Defence Force Ombudsman recommendation, reparation payments and additional payments in relation to	51-5
	F-111 Deseal/Reseal Ex-gratia Lump Sum Payments	51-5
	Former Reserve Defence Force member, compensation payments for loss of pay and/or allowances	51-5
	Reserve Defence Force member, pay and allowances	51-5
disasters
	2018 storms - relief payments	51-125
dividends or shares
	pooled development fund company dividend	124ZM
	pooled development fund company shares, income from sale of	124ZN
education and training
	Apprenticeship Wage Top-Up payment, recipient of	51-10
	bursary, educational allowance etc.	51-10 and 51-35
	Commonwealth Trade Learning Scholarship, recipient of	51-10
	CRAFT scheme, employer ' s income from	51-10
	early completion bonuses for apprentices	51-10 and 51-42
	Endeavour Awards, research fellowship under	51-10
	Endeavour Executive Award	51-10
	foreign student, scholarship and bursary to	842-105
	full-time student, income from a scholarship, bursary, other educational allowance or educational assistance	51-10 and 51-35
	isolated child, income for the provision of education of	51-10 and 51-40
	secondary student, income for the provision of education of	51-10 and 51-40
	Skills for Sustainability for Australian Apprentices payment, recipient of	51-10
	Tools for Your Trade payment (under the program known as the Australian Apprenticeships Incentives Program), recipient of	51-10
family assistance
	additional child care subsidy	52-150
	additional economic support payment 2020 or additional economic support payment 2021	52-150
	back to school bonus or single income family bonus	52-150
	child care subsidy	52-150
	clean energy advance	52-150
	economic security strategy payment to families	52-150
	economic support payment, first or second 2020 payment	52-150
	ETR payment	52-150
	ETR payment, payments under the scheme determined under Part 2 of Schedule 1 to the Family Assistance and Other Legislation Amendment (Schoolkids Bonus Budget Measures) Act 2012	52-162
	families, payments to, under the scheme determined under Schedule 4 to the Social Security and Other Legislation Amendment (Economic Security Strategy) Act 2008	52-160
	family tax benefit	52-150
	Household Stimulus Package Act (No. 2) 2009 , payments under scheme determined under Schedule 4 to the	52-165
	single income family supplement	52-150
	stillborn baby payment	52-150
financial arrangements
	gains related to exempt income	230-30
financial transactions
	pooled development fund company dividends	124ZM
	pooled development fund company shares, income from sale of	124ZN
foreign aspects of income taxation
	approved overseas project, income from	23AF
	Australian-American Education Foundation, grant from	51-10
	Commonwealth of Nations country officer, official salary and foreign income	768-100
	consul and official staff member, official salary and foreign income	768-100
	Defence Force member, foreign resident, pay and allowances of	842-105
	Defence Force member, pay and allowances from being on eligible duty	23AD
	defence of Australia, overseas person ' s income from assisting in Australia ' s defence	842-105
	diplomat and official staff member, official salary and foreign income	768-100
	educational, scientific, religious or philanthropic society, income of a visiting representative of	842-105
	expert, foreign resident, remuneration of	842-105
	foreign society or association representative, income of	842-105
	forex realisation gains, certain	775-20
	government representative and members of the entourage, foreign resident, income of	842-105
	OBU investment trusts for overseas charitable institutions	121EL(2)
	OBU off-shore investment trusts, income to which subsection 121D(6) applies	121EL
	overseas charitable institutions, income from OBUs	121ELA(1)
	overseas employment income, resident, income of	23AG
	persecution victim, payments to	768-105
	press representative, foreign, income of	842-105
	resistance fighter and victim of wartime persecution, payments to	768-105
	United Nations, income from service with	23AB
	United States projects, income from approved overseas projects	23AA
[ foreign investment] (Repealed by No 78 of 2007 )
health
	Continence Aids Payment Scheme, payments under	52-175
interest
	judgement debt, personal injury	51-57
	unclaimed money and property	51-120
[ life assurance ] (Repealed by No 89 of 2000)
life insurance companies	Subdivision 320-B
National Disability Insurance Scheme
	NDIS amounts	52-180
non-cash benefits
	business benefit	23L(2)
	exempt fringe benefit	23L(1A)
prizes
	Prime Minister ' s Literary Awards	51-60
	Prime Minister ' s Prize for Australian History	51-60
	Prime Minister ' s Prize for Science	51-60
resale royalty collecting societies	51-45
shipping
	income from shipping activities	51-100
[ mining] (Repealed by No 66 of 2003)
[ small business retirement exemption] (Repealed by No 56 of 2010)
social security or like payments
	ABSTUDY scheme, payment under	Subdivision 52-E
	additional economic support payment 2020 or additional economic support payment 2021 under the Social Security Act 1991	52-10
	additional economic support payment 2020 or additional economic support payment 2021 under the Veterans ' Entitlements Act 1986	52-65
	Australian Victim of Terrorism Overseas Payment	52-10
	Better Start for Children with Disability initiative, Outer Regional and Remote payment under	52-172
	carer adjustment payment	53-10
	carers, 2005 one-off payment to, (carer payment related), 2005 one-off payment to carers (carer service pension related) or 2005 one-off payment to carers (carer allowance related)	52-10
	carers, 2006 one-off payment to, (carer payment related), 2006 one-off payment to carers (wife pension related), 2006 one-off payment to carers (partner service pension related), 2006 one-off payment to carers (carer service pension related) or 2006 one-off payment to carers (carer allowance related)	52-10
	carers, 2007 one-off payment to, (carer payment related), 2007 one-off payment to carers (wife pension related), 2007 one-off payment to carers (partner service pension related), 2007 one-off payment to carers (carer service pension related) or 2007 one-off payment to carers (carer allowance related)	52-10
	carers, 2008 one-off payment to, (carer payment related), 2008 one-off payment to carers (wife pension related), 2008 one-off payment to carers (partner service pension related), 2008 one-off payment to carers (carer service pension related) or 2008 one-off payment to carers (carer allowance related)	52-10
	carers, one-off payment to, (carer allowance related) or one-off payment to carers (carer payment related)	52-10
	carers, payments to, under the scheme determined under Schedule 3 to the Family Assistance Legislation Amendment (More Help for Families - One-off Payments) Act 2004	52-10
	carer supplement	52-10
	child disability assistance	Subdivision 52-A
	clean energy payment under the Social Security Act 1991	52-10
	clean energy payment under the Veterans ' Entitlements Act 1986	52-65
	clean energy payment under the scheme prepared under Part VII of the Veterans ' Entitlements Act 1986	52-65
	clean energy payment under the Military Rehabilitation and Compensation Act 2004	52-114
	clean energy payment under the scheme determined under section 258 of the Military Rehabilitation and Compensation Act 2004	52-114
	Commonwealth education or training payment	Subdivision 52-F
	cost of living payment 2022 under the Social Security Act 1991	52-10
	cost of living payment 2022 under the Veterans ' Entitlements Act 1986	52-65
	disability services payment	53-10
	economic security strategy payment under the Social Security Act 1991	52-10
	economic support payment, first or second 2020 payment under the Social Security Act 1991	52-10
	economic support payment, first or second 2020 payment under the Veterans ' Entitlements Act 1986	52-65
	education entry payment supplement under the Social Security Act 1991	52-10
	energy assistance payment, one-off payment under the Social Security Act 1991	52-10
	energy assistance payment, one-off payment under the Veterans ' Entitlements Act 1986	52-65
	ETR payment, payments under the scheme determined under Part 2 of Schedule 1 to the Family Assistance and Other Legislation Amendment (Schoolkids Bonus Budget Measures) Act 2012	52-162
	farm household allowance under the Farm Household Support Act 2014	Subdivision 52-A
	Helping Children with Autism package, Outer Regional and Remote payment under	52-170
	Household Stimulus Package Act (No. 2) 2009 , payments under the scheme determined under Schedule 4 to the	52-165
	pension bonus and pension bonus bereavement payment	52-10 and 52-65
	persecution victim, payments to	768-105
	pharmaceutical supplement for Australian participants in British nuclear tests or in the British Commonwealth Occupation Force	Subdivision 52-CB
	pharmaceutical supplement for Australian surgical-medical team members	Subdivision 52-CC
	resistance fighter and victim of wartime persecution, payments to	768-105
	Social Security and Other Legislation Amendment (Economic Security Strategy) Act 2008 , payments under the scheme determined under Schedule 4 to the	52-160
	Social Security and Veterans ' Affairs Legislation Amendment (One-off Payments and Other 2007 Budget Measures) Act 2007 , payments under a scheme determined under item 1 of Schedule 2 to the	52-10
	Social Security and Veterans ' Affairs Legislation Amendment (One-off Payments and Other 2007 Budget Measures) Act 2007 , payments under the scheme determined under Schedule 4 to the	52-10
	Social Security and Veterans ' Entitlements Legislation Amendment (One-off Payments and Other Budget Measures) Act 2008 , payments under a scheme determined under item 1 of Schedule 2 to the	52-10
	Social Security and Veterans ' Entitlements Legislation Amendment (One-off Payments and Other Budget Measures) Act 2008 , payments under the scheme determined under Schedule 4 to the	52-10
	Social Security and Veterans ' Entitlements Legislation Amendment (One-off Payments to Increase Assistance for Older Australians and Carers and Other Measures) Act 2006 , payments under the scheme determined under item 1 of Schedule 2 to the	52-10
	Social Security and Veterans ' Entitlements Legislation Amendment (One-off Payments to Increase Assistance for Older Australians and Carers and Other Measures) Act 2006 , payments under the scheme determined under Schedule 4 to the	52-10
	Social Security Legislation Amendment (One-off Payments for Carers) Act 2005 , payments under the scheme determined under Schedule 2 to the	52-10
	social security payments	Subdivision 52-A
	training and learning bonus under the Social Security Act 1991	52-10
	travelling expenses for Australian participants in British nuclear tests or in the British Commonwealth Occupation Force	Subdivision 52-CB
	travelling expenses for Australian surgical-medical team members	Subdivision 52-CC
	veteran, Australian and United Kingdom, payment to	53-20
	veteran, payment to	Subdivisions 52-B and 52-C
	Veterans ' Entitlements Act 1986 , lump sum payment under section 198N of the	52-65
	wounds and disability pension	53-10
	see also welfare
structured settlements and structured orders
	annuities and lump sums	Subdivisions 54-B , 54-C and 54-D
student
	see education and training
superannuation and related business
	approved deposit fund, continuously complying fixed interest, income from 25 May 1988 deposits	295-390 of the Income Tax (Transitional Provisions) Act 1997
	approved deposit fund, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993	295-405 (table item 1)
	approved deposit fund, non-reversionary bonuses on policies of life assurance	295-335 (table item 1)
	benefits from non-complying funds	305-5
	pooled superannuation trust, income from constitutionally protected funds	295-335 (table item 2)
	pooled superannuation trust, income from current pension liabilities of complying superannuation funds	295-400
	pooled superannuation trust, non-reversionary bonuses on policies of life assurance	295-335 (table item 1)
	superannuation fund, income from other assets used to meet current pension liabilities	295-390
	superannuation fund, income from segregated current pensions assets	295-385
	superannuation fund, non-reversionary bonuses on policies of life assurance	295-335 (table item 1)
	superannuation fund, regulated, income from a grant of financial assistance under Part 23 of the Superannuation Industry (Supervision) Act 1993	295-405 (table item 1)
Territories Stolen Generations Redress Scheme
	Territories Stolen Generations Redress Scheme payments	53-30
United Nations
	United Nations Service, income from	23AB
venture capital
	eligible venture capital investments, gain or profit from realisation of	51-54
	eligible venture capital investments by ESVCLPs, income derived from	51-52
	venture capital equity, gain or profit from realisation of	51-55
[ vice regal] (Repealed by No 97 of 2008 )
welfare
	Disaster recovery payments to special category visa (subclass 444) holders	51-30
	maintenance payment	51-30 and 51-50
	thalidomide payment - payment under the Support for Australia ' s Thalidomide Survivors program	51-30
	thalidomide payment - payment by the Thalidomide Australia Fixed Trust	51-30
	see also social security or like payments

Note:

The following provisions of the Income Tax Assessment Act 1936 give rise to notional exempt income and not exempt income. For this reason the provisions do not appear in the lists of kinds of exempt income.

The provisions are: paragraphs 384(1)(b) and 385(1)(b) , subsection 402(2) and section 403 .

Subdivision 11-B - Particular kinds of non-assessable non-exempt income  

SECTION 11-50  

11-50   Effect of this Subdivision  

This Subdivision is a ^* Guide.

SECTION 11-55  

11-55   List of non-assessable non-exempt income provisions  

The provisions set out in the list make amounts non-assessable non-exempt income.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

alienated personal services income
	associate, non-deductible payment or obligation to	85-20(3)
	entitlements to a share of net income that is personal services income already assessable to an individual	86-35(2)
	payments by personal services entity or associate of personal services income already assessable to an individual	86-35(1)
	personal services entity, amounts of personal services income assessable to an individual	86-30
bonds
	see securities
capital gains tax
	small business retirement exemption, payments made directly or indirectly to CGT concession stakeholder so company or trust complies with section 152-325	152-310
cash flow boost
	payments in accordance with the Boosting Cash Flow for Employers (Coronavirus Economic Response Package) Act 2020	59-90
Coronavirus economic response
	certain payments in accordance with the Coronavirus Economic Response Package (Payments and Benefits) Act 2020	59-95
	State and Territory grants to small business relating to the recovery from the coronavirus	59-97
	Commonwealth small business support payments relating to the coronavirus	59-98
	COVID-19 disaster payment	59-96
demutualisation of friendly society health or life insurers
	amounts related to issue, or transfer from lost policy holders trust, of demutualisation assets	316-255
	payments received directly, or from lost policy holders trust, in exchange for cancellation or variation of interests under the demutualisation	316-255
demutualisation of private health insurers
	market value of shares and rights at time of issue	315-310
	payments received in exchange for cancellation or variation of interests under the demutualisation	315-310
disasters
	2019-20 bushfires - payments for volunteer work with fire services	59-55
	2019-20 bushfires - disaster relief payments and non - cash benefits	59-60
	2019 floods - recovery grants	59-85
	2019 floods - on-farm grant program	59-86
	2021 floods and storms - recovery grants	59-99
	Cyclone Seroja - recovery grants	59-105
dividends
	demerger dividends	44(4)
	later dividend set off against amount taken to be dividend	109ZC(3) , 109ZCA(4)
electricity generation
	refund of large-scale generation shortfall charge	59-100
employment
	early retirement scheme payment, tax free amount of	83-170
	employment termination payment	82-10 , 82-65 , 82-70
	foreign termination payment	83-235 , 83-240
	genuine redundancy payment, tax free amount of	83-170
	unused long service leave payment, pre-16/8/78 period	83-80
	see superannuation and sections 82-10A and 82-10C of the Income Tax (Transitional Provisions) Act 1997
environment
	water infrastructure improvement payments	59-65
farm-in farm-out arrangements
	rewards for providing exploration benefits	40-1135
financial arrangements
	gains related to non-assessable non-exempt income	230-30
firearms surrender arrangements
	compensation under	59-10
[ first home saver accounts] (Repealed by No 70 of 2015)
foreign aspects of income taxation
	attributed controlled foreign company income, amounts paid out of	23AI
	attributed foreign investment fund income, amounts paid out of	23AK
	certain forex realisation gains	775-25
	branch profits of Australian companies	23AH
	distributions of conduit foreign income	802-20
	income derived by foreign residents in exclusive economic zone or on or above continental shelf	768-110
	foreign equity distributions on participation interests	768-5
	income derived by temporary residents	768-910
	interest paid by temporary residents	768-980
	managed investment trust withholding tax, amount subject to	840-815
	labour mobility program withholding tax, amount subject to	840-915
	superannuation fund, foreign, interest and dividend income of	128B(3)(jb)
	withholding tax, dividend royalty or interest subject to	128D
GST
	GST payable on a taxable supply	17-5(a)
	increasing adjustments	17-5(b) and (c)
investment manager regime
	IMR concessions	842-215
life insurance companies	Subdivision 320-B
mining
	withholding tax, payments to Indigenous persons and distributing bodies subject to	59-15
mutual receipts
	amounts that would be mutual receipts but for prohibition on distributions to members or issue of MCIs	59-35
National Rental Affordability Scheme
	payments made, and non-cash benefits provided, by a State or Territory governmental body in relation to participation in the National Rental Affordability Scheme	380-35
native title benefits
	native title benefits	59-50
non-cash benefits
	fringe benefits	23L(1)
notional sale and loan
	arrangement payments a notional seller receives or is entitled to receive	240-40
	luxury car leases, lease payments that the lessor receives or is entitled to receive	242-40
	deemed loan treatment for financial benefits provided for tax preferred use of asset	250-160
[ offshore banking units] (Repealed by No 110 of 2021)
related entities
	amounts from, where deduction reduced for	26-35(4)
repayable amounts
	previously assessable amounts	59-30
rights to acquire shares or units
	market value of at time of issue	59-40
[ securities] (Repealed by No 47 of 2016)
small business assets
	income arising from CGT event, company or trust owned asset continuously for 15 years	152-110(2)
sovereign entities	Subdivision 880-C
[social security or like payments] (Repealed by No 145 of 2010)
superannuation
	benefits generally	Divisions 301 to 306
	commutation of income stream, under 25 years	303-5
	death benefits	302-60 , 302-65 , 302-70 , 302-140
	departing Australia superannuation benefits	301-175
	foreign superannuation funds, lump sum benefits	305-60 , 305-65 , 305-70
	KiwiSaver schemes, contributions to complying superannuation funds from	312-10
	KiwiSaver schemes, superannuation benefits paid from complying superannuation funds to	312-15
	KiwiSaver schemes, superannuation benefits paid by Commissioner to	312-20
	member benefits	301-10 , 301-15 , 301-30 , 301-225
	release authorities, payments from	303-15 303-20
	roll-over superannuation benefits	306-5
	superannuation lump sum for recipient having terminal medical condition	303-10
	unclaimed money payment to government	306-20
[ tax bonus] (Repealed by No 32 of 2014)
tax loss transfers
	consideration received by loss company from income company, generally	170-25(1)
	consideration received by loss company from income company, net capital loss	170-125(1)
	consideration received for transfer of tax losses relating to transitioned petroleum activities	417-70
temporary residents
	see foreign aspects of income taxation
trading stock
	disposal outside ordinary course of business, amounts received upon	70-90(2)
transfer of entitlements to deductions
	consideration received for transfer of entitlements to deductions relating to transitioned petroleum activities	417-70
trusts
	attributable income, amounts representing	99B(2A)
	family trust distribution tax, amounts subject to	271-105(3) in Schedule 2F
windfall amounts
	business franchise fees, refund of when invalid	59-20
	State tax on Commonwealth place, refund of when invalid	59-25
withholding taxes
	see foreign aspects of income taxation and mining

Division 12 - Particular kinds of deductions  

SECTION 12-1  

12-1   Effect of this Division  

This Division is a ^* Guide.

SECTION 12-5  

12-5   List of provisions about deductions  

The provisions set out in the table contain rules about specific types of deduction.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

 

accrued leave transfer payments	26-10
advance expenditure
	generally	82KZL to 82KZO
	avoidance arrangements	82KJ
	when deductible	82KZM to 82KZN
Australian apprenticeship support loan
	payment made to reduce a debt to the Commonwealth under the Australian Apprenticeship Support Loans Act 2014 , no deduction unless provided as fringe benefit	26-20
[ averaging of incomes] (Omitted by No 46 of 1998)
bad debts
	deduction reduced because of forgiveness of debt if debtor and creditor are companies under common ownership and agree on the reduction	245-90
	general	25-35 , 63F
	companies	Subdivisions 165-C , 166-C and 175-C
	debt/equity swaps	63E , 63F , 709-220
	deduction of a debt that used to be owed to a member of a consolidated group or MEC group by an entity that used to be a member of the group	Subdivisions 709-D and 719-I
	money lenders, listed country branches, no deduction for	63D
	see also losses
balancing adjustment
	see buildings, capital allowances, industrial property, R & D and tax exempt entities
banks
	foreign banks, Australian branches of	160ZZVA to 160ZZZJ
boats
	deferral of deductions	26-47
borrowing expenses	25-25
bribes to foreign public officials	26-52
bribes to public officials	26-53
buildings
	income producing buildings, capital allowances	Division 43
	see also heritage conservation work
capital allowances
	generally	Division 40
	balancing adjustments	40-285(2) , 40-370
	business related costs	40-880
	electricity and telephone lines	40-645
	environmental protection activities	40-755
	exploration or prospecting	40-80(1) , 40-730
	in-house software	40-335 , 40-455
	intellectual property	Subdivisions 40-B and 40-I
	IRUs	Subdivision 40-B
	landcare operations	40-630
	low-value and software development pools	Subdivision 40-E
	mining and quarrying	Subdivision 40-H and Subdivision 40-I
	new business investment, additional deduction	Division 41
	Petroleum Resource Rent Tax	40-750
	project pools	40-830 , 40-832
	reducing deductions	40-25 , 40-27 , 40-290 and 40-291
	spectrum licences	Subdivision 40-B
	tax preferred use of asset	Division 250
	telecommunications site access rights	Subdivision 40-B
	trees in carbon sink forests	Subdivision 40-J
	water facilities, horticultural plants, fodder storage assets and fencing assets	Subdivision 40-F
capital gains
	no deduction for an amount that would otherwise be deductible only because a net capital gain is included in assessable income	51AAA
	small business retirement exemption, no deduction for payments made directly or indirectly to CGT concession stakeholder so company or trust complies with section 152-325	152-310
	see also foreign residents
capital loss
	net capital loss, no deduction for	102-10
	net capital loss, transfer within company group	Subdivision 170-B
car disposal
	see capital allowances
car expenses
	generally	Division 28
	" cents per kilometre " method	Subdivision 28-C
	" log book " method	Subdivisions 28-F and 28-G
	substantiation of car expenses	Division 900
	see also transport expenses
car expenses of employee
	employee ' s car expenses where car provided by employer can be used for private purposes, no deduction for	51AF
carried interests
	carried interests, no deduction for	118-21
car parking
	employee ' s car parking expenses, no deduction for	51AGA
children ' s income
	generally	102AA to 102AH
	taxable income of a child, deductions taken into consideration in calculating	102AD
[ clean energy] (Repealed by No 83 of 2014)
club fees
	club fees, no deduction for	26-45
	see also subscriptions to associations
Commonwealth places windfall tax	26-17
companies, co-operative and mutual
	generally	117 to 121
	distributions of assessable income	120
companies, private
	excessive payments to shareholders directors and associates, reduced deduction	109
conservation covenants	Division 31
consolidated groups and MEC groups
	assets in relation to Division 230 financial arrangement	701-61(4)
controlled foreign companies
	generally	316 to 468
	bad debts	399A
	decline in value of depreciating assets	398
	finance share dividends	394
	taxes paid	393
convertible notes
	see interest
copyrights
	expenditure in obtaining registration	Subdivisions 40-B and 40-I
COVID-19
	expenditure on COVID-19 tests	25-125
cross staple arrangements
	rent from land investment	25-115 , 25-120
currency exchange gains and losses
	see foreign exchange
death of timber owner
	see timber
debt interests
	certain returns in respect of debt interests	25-85
depreciation
	see capital allowances
designs
	expenditure in obtaining or extending registration	Subdivisions 40-B and 40-I
disposal of depreciating assets
	see capital allowances
dividends
	dividends including LIC capital gain component	115-280
	franking credits, companies and foreign residents	207-95(2) , 207-95(3) , 220-405(3)
	franking credits, pooled development funds (PDFs)	124ZM
	non-share equity interests, no deduction for return in respect of	26-26
	unfranked non-portfolio dividends	46FA
education expenses
	Higher Education Contribution Scheme, no deduction unless provided as fringe benefit	26-20
	see also overseas debtors repayment levy
	see also student start-up loans
	see also VET student loans
election expenses
	Federal and State Parliament election expenses	25-60 , 25-70
	local government election expenses, limited deduction for	25-65 , 25-70
electricity connections
	see capital allowances
embezzlement
	see theft
employees
	labour mobility programs, delayed deduction for salary, wages etc. paid to employees under program until labour mobility program withholding tax payable has been paid	26-25A
	pensions, gratuities or retiring allowances for ex-employees	25-50
	see also shares
entertainment
	expenditure, no deduction for some	Division 32
	meal entertainment, calculation of deductible amount	51AEA to 51AEC
environment
	see capital allowances
excess non-concessional contributions tax
	no deduction	26-75
exploration and prospecting
	see capital allowances
family
	no deduction for maintaining spouse or child	26-40
[ family tax benefit] (Repealed by No 56 of 2010)
farm management deposits
	see primary production
[ film income] (Repealed by No 164 of 2007)
film licensed investment companies (FLICs)
	see shares
financial arrangements
	losses from	230-15(2) and (3)
	see also borrowing expenses, interest, leases and securities
foreign exchange
	losses	775-30
foreign financial entities ' Australian permanent establishments
	generally	Part IIIB
	thin capitalisation	Subdivision 820-FB
	transfer of losses	Subdivisions 170-A and 170-B
[ foreign income] (Repealed by No 143 of 2007 )
[ foreign investment funds (FIFs)] (Repealed by No 114 of 2010)
[ foreign life assurance policies] (Repealed by No 114 of 2010)
[ foreign residents] (Repealed by No 79 of 2007 )
[ foreign tax credits] (Repealed by No 143 of 2007 )
forestry managed investment schemes
	payments under scheme	394-10(1)
franchise fees windfall tax	26-15
freight
	freight for shipped goods	135A
fringe benefits
	contributions for private component, no deduction for	51AJ
	employee ' s car expenses where car provided by employer can be used for private purposes, no deduction for	51AF
	employee ' s car parking expenses, no deduction for	51AGA
	expense payment fringe benefits, reduced deduction	51AH
general insurance companies and companies that self insure
	claims paid	321-25 and 321-95
	increase in value of adjusted liability for incurred claims	321-15
	increase in value of adjusted liability for remaining coverage	321-55
	increase in value of outstanding claims liability	321-85
gifts
	general	Division 30
	limit on deduction	26-55
	see also tax avoidance schemes
[ grape vines] (Repealed by No 129 of 2004)
[ GST - acquiring or upgrading plant to meet GST obligations etc] (Repealed by No 77 of 2001)
horticultural plants
	see capital allowances
higher education assistance	26-20
hybrid mismatch rules
	disallowing of deductions	Division 832
illegal activities	26-54
income equalisation deposits
	see primary production
industrial property
	see intellectual property and R & D
infrastructure
	see tax losses
[ insurance and annuity business] (Repealed by No 101 of 2004)
insurance with non-residents
	generally	141 to 148
	insurance premiums, no deduction unless arrangement to pay tax	145
	reinsurance, no deduction for resident carrying on insurance business in Australia for reinsurance premiums paid to a non-resident	148
intellectual property
	see capital allowances
interest
	convertible notes, interest on, generally	82L to 82T
	foreign residents, debt creation involving, generally	159GZY to 159GZZF
	foreign residents, delayed deduction for interest paid to until withholding tax payable has been paid	26-25
	life assurance premiums, interest etc. on loans to finance, no deduction for	26-85
	superannuation contributions, interest etc. on loans to finance, no deduction for	26-80
	underpayment or late payment of tax, interest for	25-5
international agreements
	see transfer pricing
international profit shifting
	see transfer pricing
investment company
	see shares
IRUs
	see capital allowances
land
	land degradation, see primary production vacant land, limit on deduction	26-102
[ land degradation] (Repealed by No 95 of 2019)
lease document expenses	25-20
lease, authority, licence, permit or quota
	expenditure to terminate	25-110
leases
	finance leases and arrangements, use of property if end-user an exempt public body or use outside Australia to produce exempt income	159GE to 159GO
	leases of assets being put to tax preferred use	Division 250
	leveraged arrangements, property used:     • other than to produce assessable income; or     • by a non-resident outside Australia; or     • by a previous owner	51AD
	payment for failure to comply with lease obligation to repair premises	25-15
leases of luxury cars
	accrual amounts	242-35
	adjustment amounts (lessee)	242-70
	adjustment amounts (lessor)	242-65
	lease payments not deductible	242-55
	payments to acquire car not deductible	242-85
leave payments
	accrued leave transfer payments	26-10
	no deduction for leave payments until paid	26-10
leisure facilities
	no deduction for	26-50
[ life assurance companies ] (Repealed by No 89 of 2000)
life insurance companies	Subdivision 320-C
limited recourse debt
	later payments	243-45
	later payments (replacement debt)	243-50
loans
	see borrowing expenses, interest and securities
losses
	foreign exchange	775-30
	profit-making undertaking or scheme	25-40
	property sale	25-40
	traditional securities, loss on disposal or redemption of	70B
	see also tax losses
managed investment trusts
	losses from carried interests	275-200(4)
management and investment company shares
	see shares
membership of associations
	see subscriptions to associations
mining
	Laminaria and Corallina decommissioning levy	26-96
	see also capital allowances
misappropriation
	by employee or agent	25-47
mortgage
	expenses of discharging a mortgage	25-30
motor vehicles
	see car expenses and leases
National Disability Insurance Scheme
	National Disability Insurance Scheme expenditure	26-97
non-cash transactions
	non-cash business benefits	51AK
	non-cash consideration, money value deemed to have been paid or given	21
non-commercial business activities
	deferral of non-commercial losses	Division 35
non-resident trust estates
	generally	102AAA to 102AAZG
	modified application of depreciation provisions	102AAY
	modified application of trading stock provisions	102AAZ
	no deductions allowable under Division 36	102AAZC
notional sales and loans
	adjustment amounts (lessee)	240-110(1)
	adjustment amounts (lessor)	240-105(3)
	arrangement payments, no deduction for	240-55
	notional interest	240-50 , 250-155
	deemed loan treatment for financial benefits provided for tax preferred use of asset	Subdivision 250-C
	payments to acquire property, no deduction for	240-85
offshore banking units
	generally	121B to 121EL
overseas debtors repayment levy
	payment made to reduce a liability to overseas debtors repayment levy under the Student Loans (Overseas Debtors Repayment Levy) Act 2015 , no deduction unless provided as fringe benefit	26-20
partnerships
	foreign hybrid loss exposure adjustment	830-50
	losses, partner ' s share of partnership loss	90 , 92
patents
	expenditure relating to grant of patents, etc.	Subdivisions 40-B and 40-I
penalties
	no deduction for penalties	26-5
personal services income
	alienated personal services income	Subdivision 86-B
	general	Division 85
[ petroleum prospecting and mining] (Repealed by No 77 of 2001)
[ plant and articles] (Repealed by No 77 of 2001)
political contributions and gifts
	denial of certain deductions	26-22
	deductions for individuals	Subdivision 30-DA
pooled development funds (PDFs)	124ZM to 124ZZD
[ pooled software] (Repealed by No 77 of 2001)
prepaid expenditure
	see advance expenditure
primary production
	farm management deposits	Division 393
	see also capital allowances and timber
property
	arrangements relating to assets being put to tax preferred use	Division 250
	arrangements relating to use of property if end-user an exempt public body or use outside Australia to produce exempt income	159GE to 159GO
	leveraged arrangements, property used:     • other than to produce assessable income; or     • by a non-resident outside Australia; or     • by a previous owner	51AD
	sale of property, profit or loss	82(2)
	see also capital allowances and losses
public trading trusts
	generally	102M to 102T
qualifying securities
	see securities
[ quarrying] (Repealed by No 77 of 2001)
R & D	Division 355
rates and land taxes
	premises used to produce mutual receipts	25-75
rebatable benefits
	no deduction for	26-19
[ regional headquarters (RHQs)] (Repealed by No 47 of 2016)
registered emissions units
	expenditure incurred in becoming the holder of	420-15
	expenditure incurred in ceasing to hold	420-42
	excess of opening over closing value of	420-45
reimbursements
	expense payment fringe benefits, reduced deduction	51AH
reinsurance
	see insurance with non-residents
related entities (including relatives)
	reduction of deduction for payment or liability to	26-35 , 65(1B) and (1C)
repairs
	general	25-10
	repair covenants, payment for non-compliance with covenant to repair under lease	25-15
[ research & development] (Repealed by No 93 of 2011)
roads
	see timber
royalties
	royalty, no deduction for royalty paid to a foreign resident until the withholding tax payable has been paid	26-25
scientific research
	see R & D
securities
	qualifying securities	159GP to 159GZ
	substituted securities	23K
	traditional securities, loss on disposal or redemption of	70B
shares
	buy-backs	159GZZZJ to 159GZZZT
	cancellation of subsidiary ' s shares in holding company	159GZZZC to 159GZZZI
	employee share schemes, deduction for provider of ESS interests	Subdivision 83A-D
	see also dividends and securities
[ small-medium enterprises (SMEs)] (Repealed by No 23 of 2018)
Software
	see capital allowances
spectrum licences
	see capital allowances
State or Territory bodies (STBs)
	body ceasing to be STB, some deductions not allowed	24AW to 24AYA
student start-up loans
	payment made to reduce a debt to the Commonwealth under Chapter 2AA of the Social Security Act 1991 (student start-up loans), no deduction unless provided as fringe benefit	26-20
	payment made to reduce a debt to the Commonwealth under Part 2 of the Student Assistance Act 1973 (ABSTUDY student start-up loans), no deduction unless provided as fringe benefit	26-20
subscriptions to associations	25-55
substantiation
	work, travel and car expenses	Division 900
superannuation
	see insurance and annuity business and interest
superannuation and related business
	generally	Part 3-30
	asset disposals	295-85
	death or disability benefits, deduction for future service element	295-470
	death or disability cover, premiums for	295-465
	financial assistance levy	295-490(1) (table item 3)
	financial product advice	subsection 295-490(1) (table item 5)
superannuation contributions surcharge
	no deduction	26-60
superannuation - deductibility of contributions
	generally	Division 290
	contributions for employees etc.	Subdivision 290-B
	contributions to non-complying funds	sections 290-10 and 290-75
	first home super saver scheme re-contribution	section 290-168
	limit on deduction	26-55
	no deduction under any other provision of the Act	section 290-10
	personal contributions	Subdivision 290-C
[ superannuation - employer contributions] (Repealed by No 15 of 2007)
superannuation guarantee charge
	no deduction for	26-95
	late contribution offset, no deduction for	290-95
superannuation supervisory levy
	late lodgment amount, no deduction for	26-90
tax agent ' s fees
	see tax related expenses
tax avoidance schemes
	companies, use of tax losses or deductions to avoid tax	Division 175
	diverted assessable income	121F to 121L
	dividend stripping	177E
	gifts	78A
	imputation, manipulation of	207-150(2) , 207-150(3)
	prepaid outgoings to avoid tax	82KJ
	recouped expenditure	82KH to 82KL
	tax avoidance scheme, no deduction allowable where deduction the result of	177A to 177G
	trading stock	70-20 , 52A
tax exempt entities
	treatment of losses and outgoings on becoming taxable	Schedule 2D
tax losses
	bad debts, companies	165-120
	change of ownership or control of a company     generally	Division 165
	for earlier income years	Subdivision 165-A
	for income year of the change	Subdivision 165-B
	designated infrastructure project entities	Division 415
	earlier income years	Division 36
	life insurance companies	Subdivision 320-D
	pooled development funds	Subdivision 195-A
	transfer between companies in same wholly-owned group	Subdivision 170-A
tax preferred asset financing
	generally	Division 250
	denial of capital allowance deductions in relation to asset being put to tax preferred use	250-145
	reduction in capital allowance deductions in relation to asset being put to tax preferred use	250-150
tax related expenses	25-5
telecommunications site access rights
	see capital allowances
telephone lines
	see primary production
[ termination payments surcharge] (Repealed by No 23 of 2018)
theft
	by employee or agent	25-45
thin capitalisation
	disallowing of deductions	Division 820
	previously FRT disallowed amounts	820-56
timber
	death of owner of land carrying trees, deduction of the part of land cost attributable to trees	70-120
	disposal of land carrying trees, deduction of the part of land cost attributable to trees	70-120
	felling trees, deduction of cost of land attributable to trees felled or of cost of right to fell trees	70-120
	see also capital allowances
[ trade support loan] (Repealed by No 61 of 2023)
trading ships
	see capital allowances
trading stock
	Commissioner may determine whether consideration paid for chose in action is reasonable	52A
	excess of opening stock over closing value	70-35(3)
	expenditure deemed not to be of a capital nature	70-25
	prepayments, when stock becomes trading stock on hand	70-15
	see also tax avoidance schemes and timber
traditional securities
	see securities
training guarantee
	training guarantee charge, no deduction for	51(7)
transfer pricing
	arm ' s length principle for cross-border conditions between entities	Subdivision 815-B
	arm ' s length principle for permanent establishments	Subdivision 815-C
transport expenses
	incurred in travel between workplaces	25-100
travel expenses
	accompanying relatives, no deduction for some travel expenses	26-30
	travel related to the use of residential premises as residential accommodation	26-31
	see also substantiation
trees in carbon sink forests
	see capital allowances
trusts
	trust income, deductions considered in calculating	95 to 102
	see also foreign residents , non-resident trust estates and public trading trusts
uniforms
	non-compulsory uniforms	Division 34
[ United Medical Protection Limited support payments] (Repealed by No 105 of 2019)
uranium mining
	see mining
VET student loans
	payment made to reduce a debt to the Commonwealth under Part 3A of the VET Student Loans Act 2016 (VETSL debts), no deduction unless provided as fringe benefit	26-20
water facilities
	improvements	26-100
	see also capital allowances
work expenses
	see substantiation
work in progress
	payment of a work in progress amount	25-95

Division 13 - Tax offsets  

SECTION 13-1A  

13-1A   Effect of this Division  

This Division is a ^* Guide.

SECTION 13-1  

13-1   List of tax offsets  

The provisions set out in the list allow you a tax offset.

Provisions of the Income Tax Assessment Act 1997 are identified in normal text. The other provisions, in bold , are provisions of the Income Tax Assessment Act 1936 .

Aboriginal study assistance
	see social security and other benefit payments
annual leave
	see leave payments
annuity
	see superannuation
approved deposit funds (ADFs)
	see dividends
attribution managed investment trusts
	non-resident beneficiary 276-110
averaging
	see primary production
bonuses
	see life assurance
child
	increased tax payable under Part III Division 6AA, unreasonable 102AH trust income 100(2)
[ child/housekeeper] (Repealed by No 70 of 2015)
corporate unit trusts
	see dividends
Cyclone Larry or Cyclone Monica income support payment
	see social security and other benefit payments
defence force
	members serving overseas 79B
dependants
	invalid relative, invalid spouse or carer in receipt of carer benefit Subdivision 61-A
dividends
	general 207-20(2) , 207-45 , 207-110(2) (c), 210-170(1)
early stage venture capital limited partnerships
	contributions to ESVCLPs Subdivision 61-P
[ education expenses] (Repealed by No 50 of 2012)
[ drought relief] (Repealed by No 179 of 1997)
employment termination
	employment termination payments 82-10 , 82-70 see leave payments, superannuation and sections 82-10A and 82-10C of the Income Tax (Transitional Provisions) Act 1997
[ entrepreneurs ' tax offset] (Repealed by No 23 of 2012)
Equine Workers Hardship Wage Supplement Payment
	see social security and other benefit payments
[ exceptional circumstances relief] (Repealed by No 13 of 2014)
exploration for minerals
	junior minerals exploration incentive Subdivision 418-B
[ farm help income support] (Repealed by No 13 of 2014)
[ farm household support] (Repealed by No 97 of 2008 )
film
	Division 376
[ films] (Repealed by No 143 of 2007 )
foreign income tax
	foreign income tax paid, tax offset for Division 770
franking deficit tax
	liabilities to pay 205-70
franked dividends
	see dividends
hardship
	see child
[ housekeeper] (Repealed by No 70 of 2015)
housing
	National Rental Affordability Scheme Division 380
imputation
	see dividends and franking deficit tax
[ infrastructure] (Repealed by No 4 of 2018)
innovation companies
	certain shares issued to early stage investors Subdivision 360-A
inter-corporate dividends
	see dividends
interest
	tax paid on by company 127
interim income support payment
	see social security and other benefit payments
invalid relative
	see dependants
[ land transport facilities borrowings] (Repealed by No 41 of 2011)
leave payments
	unused annual leave payment 83-15 unused long service leave payment 83-85 see employment termination
legal disability
	see trusts
life assurance
	bonus, receipt of 160AAB
life insurance company
	subsidiary joining consolidated group 713-545(5)
long service leave
	see leave payments
losses
	loss carry back Division 160
low income earner
	aged or pensioner beneficiary, trustee liable to be assessed for beneficiary ' s share of net income of trust estate 160AAAB aged person or pensioner 160AAAA general Subdivision 61-D
lump sum income arrears
	receipt of 159ZRA , 159ZRB , Subdivision 61-L
[ mature age workers] (Repealed by No 20 of 2015)
[ medical expenses] (Repealed by No 11 of 2014)
non-resident beneficiary
	see trusts
non-resident trust estate
	see trusts
overseas defence force service
	see defence force
[ overseas tax] (Repealed by No 143 of 2007 )
[ parent/parent-in-law] (Repealed by No 70 of 2015)
partnerships
	see dividends , housing and small business entities
pension
	see social security and other benefit payments
pooled superannuation trusts (PSTs)
	see dividends
primary production
	averaging of income, trustees 156 averaging of tax liability, individuals 392-35(2) farm household allowance   see social security and other benefit payments interim income support payments   see social security and other benefit payments
private health insurance Subdivision 61-G
public trading trust
	see dividends
public unit trust
	see dividends
R & D Division 355
[ rebatable ETP annuity] (Repealed by No 15 of 2007)
[ research and development] (Repealed by No 93 of 2011)
residents of isolated areas
	see zone
[ restart income support] (Repealed by No 144 of 2000)
[ savings and investment income] (Repealed by No 60 of 1999)
[ shipping income] (Repealed by No 143 of 2007 )
[ sickness benefits] (Repealed by No 26 of 2018)
small business
	small business income Subdivision 328-F
[ small business entities] (Repealed by No 23 of 2012)
social security and other benefit payments
	Aboriginal study assistance scheme 160AAA(3) children, assistance for isolated 160AAA(3) Cyclone Larry or Cyclone Monica income support payment 160AAA(3) Disaster income support allowance for special category visa (subclass 444) holders 160AAA(3) Equine Workers Hardship Wage Supplement Payment 160AAA(3) farm household allowance under the Farm Household Support Act 2014 see unemployment and other benefit payments under the Social Security Act 1991 interim income support payment 160AAA(3) pension, social security pension and veteran ' s pension 160AAAA textile, clothing and footwear allowance 160AAA(3) unemployment and other benefit payments under the Social Security Act 1991 160AAA(3)
[ sole parent] (Repealed by No 83 of 1999)
[ spouse] (Repealed by No 70 of 2015)
superannuation
	generally Divisions 301 and 302 associated earnings on non-concessional contributions Subdivision 292-B spouse contributions Subdivision 290-D death benefits 302-75 , 302-85 , 302-145 excess concessional contributions 291-15(b) first home super saver scheme 313-25 member benefits 301-20 , 301-25 , 301-35 , 301-40 , 301-95 , 301-100 , 301-105 , 301-115 TFN quoted to superannuation or RSA provider after no-TFN contributions tax paid 295-675 veterans ' invalidity pensions Subdivision 301-F
[ superannuation funds] (Repealed by No 15 of 2007)
[ tax credit] (Repealed by No 143 of 2007 )
termination payments
	see employment termination, leave payments and superannuation
trustee
	see dividends , low income earner and trusts
trusts
	beneficiary in a foreign trust 98B non-resident beneficiary 98A(2)(a) trust income of beneficiary with legal disability 100(2) trust income (modifications for special disability trusts) 95AB(5) see also dividends , housing and small business entities
United Nations forces
	salary, wages and allowances from service as a member of 23AB(7)
unemployment benefits
	see social security and other benefit payments
unit trusts
	see dividends
[ water] (Repealed by No 84 of 2013)
winding-up of non-resident trust estates
	see trusts
withholding payments
	made by companies to Australian seafarers Subdivision 61-N
zone
	residents of isolated areas 79A