Commonwealth Numbered Regulations - Explanatory Statements

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INCOME TAX REGULATIONS 1991 NO. 300

STATUTORY RULES 1991 No. 300

Issued by Authority of the Treasurer

Income Tax Assessment Act 1936

Income Tax Regulations

These regulations amend the Income Tax Regulations to exempt certain allowances paid to members of the Australian Defence Force (ADF).

Subparagraph 23(t)(iii) of the Income Tax Assessment Act 1936 (the Act) provides that in the case of a member of the Defence Force, payments of any allowance or bounty of a prescribed kind payable to or in respect of the member shall be exempt from income tax.

Regulation 5 of the Income Tax Regulations specifies the allowances and bounties that are prescribed for the purposes of subparagraph 23(t)(iii).

The regulations amend regulation 5 and insert two further allowances:

(a)       a Disturbance Allowance payable under Determination 505 of the Defence Act 1903; and

(b)       a Transfer Allowance payable under Determination 3702 of that Act.

These allowances are intended to assist ADF personnel with the out-of-pocket expenses associated with a removal and the accelerated depreciation of furniture and effects caused by repeated removals. The disturbance allowance covers the removal on posting of ADF personnel and their families within Australia, and the transfer allowance covers removals overseas.

The effect of this amendment is that disturbance and transfer allowances paid to ADF personnel on or after 1 July 1991 are exempt from income tax.

The Regulations will not affect the rights of any person (other than the Commonwealth) in a manner prejudicial to that person, nor will they impose any liability on such a person. They are therefore in accord with the Acts Interpretation Act 1901.