Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 51.57

Interest on judgment debt relating to personal injury

             (1)  An amount paid by way of interest on a judgment debt, whether payable under an * Australian law, or otherwise, is exempt from income tax if:

                     (a)  the judgment debt arose from a judgment (the original judgment ) given by, or entered in, a court for an award of damages for personal injury; and

                     (b)  the amount is in respect of the whole or any part of the period:

                              (i)  beginning at the time of the original judgment, or, if the judgment debt is taken to have arisen at an earlier time, at that earlier time; and

                             (ii)  ending when the original judgment is finalised.

             (2)  For the purposes of subsection (1), an original judgment is finalised at whichever of the following times is applicable:

                     (a)  if the period for lodging an appeal against either the original judgment or a subsequent related judgment ends without an appeal being lodged--the end of the period;

                     (b)  if an appeal from either the original judgment or a subsequent related judgment is lodged and final judgment on the appeal is given by, or entered in, a court--when the final judgment takes effect;

                     (c)  if an appeal from either the original judgment or a subsequent related judgment is lodged but is settled or discontinued--when the settlement or discontinuance takes effect.

             (3)  For the purposes of paragraph (2)(b), a judgment is a final judgment if:

                     (a)  no appeal lies against the judgment; or

                     (b)  leave to appeal against the judgment has been refused.



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