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Appendix 2 – Comparison of key income definitions for: Working for Families Tax Credits, child support and student loans

 

✔ Included in income ✘ Not included in income

TYPE OF INCOME Working for Families Tax Credits Child support (current rules)[33] Child support (2013 reform proposal) Student loans
Net income
Available tax losses
Non-resident foreign source income
Net loss from investment or business activity
Exempt income        
  • Overseas pensions
  • Maintenance payments (for example child support)
  • Salary or wages exempt from income tax
  • Half of income from annuity under a life insurance policy
Portfolio Investment Entity (PIE) income        
  • Income attributed by a PIE unless the PIE is a superannuation fund or retirement savings scheme
  • Distributions from a listed PIE
Main income equalisation accounts        
  • Deposits made
  • Refunds received (excluding interest)
Share of undistributed income of a closely held company
Associated persons share included
Certain contributions to retirement savings schemes[34]
Certain distributions from superannuation schemes, distribution of retirement scheme contribution
Settlor share of non-beneficiary income or undistributed income of a closely held company owned by trustees
Employment benefits (person has no control over company)        
  • Salary sacrifice for private use of motor vehicle
  • Value of short-term charge facilities
Employment benefits (person has control over company)        
  • Taxable value of attributed fringe benefits + related FBT
Non-beneficiary income from a trust (not settlor) (specifically provided)
Depreciation loss (allowed 2002–03 or earlier income year) clawed back on sale of buildings
Income greater than $500 derived by dependent child
Child tax credit
Other income (subject to exclusions and $5,000 de minimus)
Deduction from income for maintenance payments made (for example child support) [35]
 

33 Other than through an adminstrative review.

34 Contribution already included in a return of income for the income year the contribution is made and therefore in "net income" for social policy purposes.

35 Deduction allowed under the 2013 child support proposal but would have required amendment to avoid circularity in income calculation.