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.
(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).