ATO Interpretative Decision

ATO ID 2002/767 (Withdrawn)

Income Tax

Assessability of attendant care allowance paid under the Safety Rehabilitation and Compensation Act 1988
FOI status: may be released

This ATO ID is withdrawn. The view contained in the ATO ID expresses a straight application of the law. Guidance relating to the issue is addressed in web content Super pensions, annuities and government payments (QC 31969) and Amounts that you do not pay tax on 2017 (QC 51059).

This document has changed over time. View its history.

CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

This ATOID provides you with the following level of protection:

If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.

Issue

Is an attendant care allowance paid to a taxpayer by the Commonwealth Department of Veterans' Affairs in accordance with section 29 of the Safety Rehabilitation and Compensation Act 1988 (SRCA), assessable income under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Decision

Yes. The attendant care allowance received by the taxpayer from the Commonwealth Department of Veterans' Affairs for providing attendant care services are included in their assessable income under section 6-5 of the ITAA 1997.

Facts

The Commonwealth Department of Veterans' Affairs pays an attendant care allowance to the taxpayer in accordance with section 29 of the SRCA.

The allowance is paid monthly for attendant care services provided by the taxpayer for their spouse.

Reasons for Decision

Section 6-5 of the ITAA 1997 provides that the assessable income of a resident taxpayer includes ordinary income derived directly or indirectly from all sources during the income year.

However, subsection 6-15(2) of the ITAA 1997 provides that if an amount is exempt income then it is not assessable income.

Ordinary income has generally been held to include three categories, namely, income from rendering personal service, income from property and income from carrying on a business.

As the regular periodical amounts received by the taxpayer are payments for personal services they have rendered in caring for their spouse, they are income according to ordinary concepts and therefore ordinary income.

Subdivision 52-B of the ITAA 1997 exempts from income tax an attendant allowance paid under section 98 of the Veterans' Entitlements Act 1986 (VEA). An attendance allowance that is paid under that provision is for specific war-caused injuries or war-caused diseases payable to a veteran who is entitled to a veterans' pension under Part II of the VEA.

Although the taxpayer receives an attendant care allowance from the Commonwealth Department of Veterans' Affairs, the allowance is paid under section 29 of the SRCA not section 98 of the VEA. There is no corresponding provision in the Income Tax Assessment Act 1936 or ITAA 1997 that exempts an attendant care allowance paid under section 29 of the SRCA. The attendant care allowance received by the taxpayer is therefore assessable income under section 6-5 of the ITAA 1997.

Amendment History

Date of Amendment	Part	Comment
27 February 2015	Reasons for Decision	Minor grammatical amendment

Date of decision: 10 April 2002

Year of income: Year ending 30 June 2002 Year ending 30 June 2003

Legislative References:
Income Tax Assessment Act 1997
   section 6-5
   subsection 6-15(2)
   Subdivision 52-B

Safety Rehabilitation and Compensation Act 1988
section 29

Veterans' Entitlements Act 1986
Part II
section 98

Related ATO Interpretative Decisions
ATO ID 2001/798

Keywords
Income
Exempt income
Compensation income

Business Line: Small Business/Individual Taxpayers

Date of publication: 31 July 2002

ISSN: 1445-2782

history

	Date:	Version:
	10 April 2002	Original statement
	27 February 2015	Updated statement
You are here	22 September 2017	Archived

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