INCOME TAX ASSESSMENT ACT 1936 (ARCHIVE)

PART III - LIABILITY TO TAXATION  

Division 1AA - Exemption from income tax: payments under the Social Security Act 1991 and the Veterans' Entitlements Act 1986, and similar payments  

Subdivision B - Exemption from income tax - payments under the Social Security Act 1991  

SECTION 24ABD   DISABILITY SUPPORT PENSION  

24ABD(1)   [Tax treatment of disability support pension payments]  

The treatment of payments of disability support pension under Part 2.3 of the Social Security Act 1991 is as follows:

Item	Category	Supplementary amounts	Balance of payment
1	Taxpayer not under pension age	Exempt	Not exempt
2	Taxpayer under pension age	Exempt	Exempt

24ABD(2)   [Operation of subsec (1)]  

Subsection (1) has effect subject to subsection (4) (which deals with taxpayers who derive bereavement lump sum payments under section 146H of the Social Security Act 1991 ) and subsection (5) (which deals with certain payments after the death of a taxpayer's partner).

24ABD(3)   [Exempt payments]  

Payments under sections 146G, 146K and 146Q of the Social Security Act 1991 (which deal with bereavement payments) are exempt.

24ABD(4)   [Payment eligible for partial exemption only]  

If a taxpayer derives a payment under section 146H of the Social Security Act 1991 :

(a) so much of the sum of that payment and other payments under the Social Security Act 1991 derived by the taxpayer on pension paydays that occurred during the bereavement lump sum period as does not exceed the tax-free amount calculated using the exempt bereavement payment calculator A in section 24ABZB is exempt; and

(b) the balance of the sum is not exempt.

24ABD(5)   [Disability support pensions after death of partner]  

If:

(a) a taxpayer's partner died; and

(b) the taxpayer is not under pension age; and

(c) the taxpayer would have been qualified for payments under a bereavement Subdivision but for an exclusion provision (taxpayer's pension or allowance increased on partner's death to such an extent that no bereavement payments); and

(d) the taxpayer derives payments of disability support pension under Part 2.3 of the Social Security Act 1991 on one or more of the 7 pension paydays after the death;

then those payments on that payday or each of those paydays are not treated under subsection (1) but are treated as follows:

(e) the supplementary amounts are exempt;

(f) so much of the balance as exceeds what would have been the balance (payments less supplementary amounts) if the partner had not died is exempt;

(g) the rest of the balance is not exempt.