Commonwealth Consolidated Acts

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INCOME TAX ASSESSMENT ACT 1997 - SECT 82.70

Death benefits for non-dependants

Tax free component

             (1)  The * tax free component of a * death benefit termination payment that you receive after the death of a person of whom you are not a * death benefits dependant is not assessable income and is not * exempt income.

Taxable component

             (2)  If you receive a * death benefit termination payment after the death of a person of whom you are not a * death benefits dependant, the * taxable component of the payment is assessable income.

             (3)  You are entitled to a * tax offset that ensures that the rate of income tax on the amount mentioned in subsection (4) does not exceed 30%.

Note:          The remainder of the taxable component is taxed at the top marginal rate in accordance with the Income Tax Rates Act 1986 .

             (4)  The amount is so much of the * taxable component of the payment as does not exceed the * ETP cap amount.

Note:          For the ETP cap amount, see section 82-160.

             (5)  The * ETP cap amount is reduced (but not below zero) by the amount worked out under subsection (4) for each * death benefit termination payment (if any) you have received earlier in consequence of the same employment termination, whether in the income year or an earlier income year.

Note 1:       See subsection 82-75(3) for the tax treatment of any amount by which you may have benefited from an employment termination payment to the trustee of the estate of the deceased.

Note 2:       If you have also received a life benefit termination payment in the same income year, your entitlement to a tax offset under this section is not affected by your entitlement (if any) to an offset for the life benefit termination payment (under section 82-10).



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