Division 6—Assessable income and exempt income
Table of sections
6-1 Diagram showing relationships among concepts in this Division
Operative provisions
6-5 Income according to ordinary concepts (ordinary income)
6-10 Other assessable income (statutory income)
6-15 What is not assessable income
6-20 Exempt income
6-25 Relationships among various rules about ordinary income
6-1 Diagram showing relationships among concepts in this Division
(1) Assessable income consists of *ordinary income and *statutory income.
(2) Some *ordinary income, and some *statutory income, is *exempt income.
(3) *Exempt income is not assessable income.
(4) Some *ordinary income, and some *statutory income, is neither assessable income nor *exempt income.
6-5 Income according to ordinary concepts (ordinary income)
(1) Your assessable income includes income according to ordinary concepts, which is called ordinary income.
Note: Some of the provisions about assessable income listed in section 10-5 may affect the treatment of ordinary income.
(2) If you are an Australian resident, your assessable income includes the *ordinary income you *derived directly or indirectly from all sources, whether in or out of Australia, during the income year.
(3) If you are not an Australian resident, your assessable income includes:
(a) the *ordinary income you *derived directly or indirectly from all *Australian sources during the income year; and
(b) other *ordinary income that a provision includes in your assessable income for the income year on some basis other than having an *Australian source.
(4) In working out whether you have derived an amount of *ordinary income, and (if so) when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct.
6-10 Other assessable income (statutory income)
(1) Your assessable income also includes some amounts that are not *ordinary income.
Note: These are included by provisions about assessable income.
For a summary list of these provisions, see section 10-5.
(2) Amounts that are not *ordinary income, but are included in your assessable income by provisions about assessable income, are called statutory income.
Note: Many provisions in the summary list in section 10-5 contain rules about ordinary income. These rules do not change its character as ordinary income.
(3) If an amount would be *statutory income apart from the fact that you have not received it, it becomes statutory income as soon as it is applied or dealt with in any way on your behalf or as you direct.
(4) If you are an Australian resident, your assessable income includes your *statutory income from all sources, whether in or out of Australia.
(5) If you are not an Australian resident, your assessable income includes:
(a) your *statutory income from all *Australian sources; and
(b) other *statutory income that a provision includes in your assessable income on some basis other than having an *Australian source.
6-15 What is not assessable income
(1) If an amount is not *ordinary income, and is not *statutory income, it is not assessable income (so you do not have to pay income tax on it).
(2) If an amount is *exempt income, it is not assessable income.
Note: If an amount is exempt income, there are other consequences besides it being exempt from income tax. For example:
·
the amount may be taken into account in working out the amount of a tax loss (see section 36-10);·
you cannot deduct as a general deduction a loss or outgoing incurred in deriving the amount (see Division 8).To find out about exempt income, see section 6-20.
